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Lesson 5 ~25 min Unit 1 · Financial Maths +85 XP

Percentage Increase

When prices, populations and pay packets rise — two ways to find the new value quickly.

Today's hook: A job pays $\$18$/hour and gives you a $12\%$ pay rise. How much will you earn now?
0/5QUESTS
Think First
warm-up

A job pays $\$18$/hour and gives you a $12\%$ pay rise. How much will you earn now? Jot down your first reaction — then we'll see who's right.

Record your answer in your workbook.
1
The Big Idea
+5 XP

A percentage increase ADDS a percentage of the original to itself. There are TWO equivalent methods — the add-the-increase method and the faster multiplier method.

A $12\%$ pay rise on $\$18$/hour. Method 1 (add): $12\%$ of $18$ is $\$2.16$; add to original $= \$20.16$. Method 2 (multiplier): the new wage is $112\%$ of the old, so $1.12 \times 18 = \$20.16$. Same answer. The multiplier is faster, especially with a calculator.

New $= $ Original $\times \left(1 + \dfrac{P}{100}\right)$
Add or multiply
Both work. Multiplier is faster on a calculator.
$1 + $ rate
$12\%$ rise $= \times 1.12$. $5\%$ rise $= \times 1.05$.
GST is a $10\%$ rise
Inc-GST price = $\times 1.10$.
2
What You'll Master
objectives

Know

  • New value = original + (% of original)
  • New value = original $\times (1 + \tfrac{P}{100})$
  • $12\%$ increase $\to$ multiplier $1.12$
  • $5\%$ increase $\to$ multiplier $1.05$

Understand

  • Why $1 + \tfrac{P}{100}$ collapses the two steps into one
  • How GST is a percentage increase
  • The difference between an increase and the new total

Can Do

  • Apply a percentage rise to any starting value
  • Choose between the add and multiplier methods
  • Use the multiplier method confidently on a calculator
3
Words You Need
vocabulary
Percentage increaseAdding a percentage of the original onto the original.
MultiplierThe single number you multiply by, e.g., $1.12$ for $12\%$.
New valueThe amount AFTER the increase.
Add methodFind the % increase, then add to original.
Multiplier methodNew = original $\times (1 + \tfrac{P}{100})$.
Pay riseAn increase in hourly pay, often given as a percentage.
4
Spot the Trap
heads-up

Wrong: "$12\%$ rise on $\$18 = 18 + 12 = \$30$" — NO. You added 12 dollars, not 12 percent.

Right: $12\%$ of $18 = \$2.16$. New $= 18 + 2.16 = \$20.16$.

Wrong: "Multiplier for $12\%$ rise = $\times 0.12$" — NO. That gives the INCREASE, not the new total.

Right: Multiplier $= 1 + 0.12 = 1.12$. $1.12 \times 18 = \$20.16$.

5
Method 1 — Add the Increase
+5 XP

A two-step approach: find the percentage as a quantity, then add it.

Take a $\$50$ jumper with a $20\%$ markup. Step 1: find $20\%$ of $\$50 = \$10$. Step 2: $\$50 + \$10 = \$60$. The intermediate step (the increase itself) is useful — it tells you HOW MUCH the price went up. But it's slower than the multiplier method.

New $= $ Original $+ \dfrac{P}{100} \times $ Original
Two clear steps
Find the increase, then add.
Best for understanding
Use this method to explain WHY.
Shows the increase
Tells you BOTH the rise and the new total.
6
Method 2 — The Multiplier
+5 XP

A single multiplication. New value equals original times the multiplier.

A $15\%$ increase means the new value is $115\%$ of the old: a multiplier of $1.15$. So $\$200$ becomes $200 \times 1.15 = \$230$. A $7\%$ rise? Multiplier is $1.07$. The rule: $1 + \tfrac{P}{100}$.

$P\%$ rise $\Rightarrow$ multiplier $= 1 + \dfrac{P}{100}$
Always above 1
Multiplier for an INCREASE is always $> 1$.
Add 1 to the decimal
$0.12 \to 1.12$. $0.075 \to 1.075$.
Single button
One calculator operation.
Watch Me Solve It · The pay rise
+15 XP per step
Q1
PROBLEM
You earn $\$18$/hour and get a $12\%$ pay rise. What is your new hourly wage?
  1. 1
    Set up the multiplier
    $12\%$ rise $\to$ multiplier $= 1.12$
    $1 + 0.12 = 1.12$.
  2. 2
    Multiply
    $18 \times 1.12$
    One calculator step.
  3. 3
    Compute
    $18 \times 1.12 = \$20.16$
    New hourly rate.
Answer$\$20.16$/hour
Watch Me Solve It · GST (10% increase)
+15 XP per step
Q2
PROBLEM
A meal costs $\$45$ before GST. GST adds $10\%$. What does it cost including GST?
  1. 1
    Multiplier for $10\%$ rise
    $1 + 0.10 = 1.10$
    $10\%$ becomes $1.10$.
  2. 2
    Multiply
    $45 \times 1.10$
    Apply to original.
  3. 3
    Compute
    $45 \times 1.10 = \$49.50$
    Includes GST.
Answer$\$49.50$
Watch Me Solve It · Population
+15 XP per step
Q3
PROBLEM
A town has $25\,000$ people. The population grows $4\%$ in a year. How many people next year?
  1. 1
    Add method: find the increase
    $4\%$ of $25\,000 = 0.04 \times 25\,000 = 1000$
    That's the number of new people.
  2. 2
    Add to original
    $25\,000 + 1000 = 26\,000$
    New population.
  3. 3
    Check with multiplier
    $25\,000 \times 1.04 = 26\,000$ ✓
    Same answer.
Answer$26\,000$ people
8
Common Pitfalls
heads-up
Using $\times 0.12$ instead of $\times 1.12$
Gives you just the increase, not the new total.
Fix: Add 1 to the decimal. $0.12 \to 1.12$.
Adding rate as a dollar amount
Treating $12\%$ as $\$12$ added directly.
Fix: $12\%$ means $\tfrac{12}{100}$ of the original.
Confusing increase with new total
Answer "$\$2.16$" when asked for the new wage.
Fix: Read the question. "New wage" = original $+$ increase.
Copy Into Your Books

Method 1: Add

  • Increase $= \tfrac{P}{100} \times $ Original
  • New $= $ Original $+$ Increase
  • Two steps

Method 2: Multiplier

  • Multiplier $= 1 + \tfrac{P}{100}$
  • New $= $ Original $\times $ Multiplier
  • One step

Common Multipliers

  • $5\%$ rise: $\times 1.05$
  • $10\%$ rise: $\times 1.10$
  • $12.5\%$ rise: $\times 1.125$

GST

  • GST = $10\%$
  • Inc-GST price = $\times 1.10$
  • Quick way to add GST

How are you completing this lesson?

D
Brain Trainer · Percentage Increase
4 problems

Four drill problems to sharpen your skills. Work each, then reveal the answer.

  1. 1 Increase $\$80$ by $25\%$.

    $80 \times 1.25 = 100$.$\$100$
  2. 2 Increase $200$ kg by $15\%$.

    $200 \times 1.15 = 230$.$230$ kg
  3. 3 A $\$120$ jacket has GST added. What's the inc-GST price?

    $120 \times 1.10 = 132$.$\$132$
  4. 4 A $\$50$ bill increases by $4\%$. New bill?

    $50 \times 1.04 = 52$.$\$52$
Complete in your workbook.
1
$\$200$ increased by $20\%$ is:
+10 XP
2
The multiplier for a $7.5\%$ increase is:
+10 XP
3
A $\$160$ guitar has GST added. The inc-GST price is:
+10 XP
4
Mia's hourly rate is $\$22$. After a $5\%$ rise, she earns:
+10 XP
5
A library has $4500$ books. After a $12\%$ donation drive, it has:
+10 XP
Show Your Working
9 marks total
Apply Medium 3 MARKS

Q6. Increase each by the percentage shown using the multiplier method: (a) $\$340$ by $15\%$   (b) $80$ kg by $7.5\%$   (c) $\$1250$ by $4\%$

Answer in your workbook.
Understand Easy 2 MARKS

Q7. A streaming service charged $\$12/$month last year. Prices rose $8\%$ this year. What is the new price, and what was the increase in dollars?

Answer in your workbook.
Reason Hard 4 MARKS

Q8. A laptop is advertised at $\$1200$ exc-GST. The store also offers a $5\%$ "early-bird" markup on selected items. (a) Find the price after GST only. (b) Find the price after BOTH the early-bird markup and GST (apply markup first, then GST). (c) Is the order in which you apply the two increases important? Justify with calculation.

Answer in your workbook.
Comprehensive Answers

Quick Check

1. C — $200 \times 1.20 = \$240$.

2. C — $1 + 0.075 = 1.075$.

3. D — $160 \times 1.10 = \$176$.

4. C — $22 \times 1.05 = \$23.10$.

5. C — $4500 \times 1.12 = 5040$.

Show Your Working Model Answers

Q6 (3 marks): (a) $340 \times 1.15 = \$391$ [1]. (b) $80 \times 1.075 = 86$ kg [1]. (c) $1250 \times 1.04 = \$1300$ [1].

Q7 (2 marks): New: $12 \times 1.08 = \$12.96$ [1]. Increase: $12.96 - 12 = \$0.96$ [1].

Q8 (4 marks): (a) $1200 \times 1.10 = \$1320$ [1]. (b) Markup first: $1200 \times 1.05 = \$1260$. Then GST: $1260 \times 1.10 = \$1386$ [2]. (c) NO — order does not matter: $1200 \times 1.05 \times 1.10 = 1200 \times 1.10 \times 1.05 = \$1386$ (multiplication is commutative) [1].

Stretch Challenge · +25 XP, +10 coins

The Doubling Salary

A worker earns $\$50\,000$/year. Their salary increases $7\%$ every year. (a) What is their salary after 1 year? After 5 years? (b) After how many full years has their salary more than doubled? (Hint: try multiplying the multiplier by itself repeatedly.)

Reveal solution

(a) Year 1: $\$53\,500$. Year 5: $50000 \times 1.07^5 = 50000 \times 1.4026 \approx \$70\,128$. (b) Need $1.07^n > 2$. $1.07^{10} \approx 1.967$ (not yet); $1.07^{11} \approx 2.105$ (yes!). So 11 years.

R
Quick Review

Add method

Find the increase, then add

Multiplier

$1 + \tfrac{P}{100}$

$10\%$ rise

$\times 1.10$

$5\%$ rise

$\times 1.05$

GST

A 10% increase

Always $> 1$

Multiplier for increase is bigger than 1

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