Discount Calculator

In retail terminology, both terms describe a price reduction, but they are used differently. A discount is typically a temporary price reduction for promotional purposes (sales, coupons, loyalty rewards). A markdown is usually a permanent reduction to sell slow-moving inventory, end-of-season stock, or superseded models. From a consumer's mathematical perspective, both are calculated the same way — a percentage reduction from the original price. The distinction matters more for retail accounting and pricing strategy than for the consumer calculation.

In most retail contexts, discounts are applied to the pre-tax price, and tax is then calculated on the discounted amount. This is the most consumer-favorable approach and is standard in the US. If you see a $100 item at 20% off with 8% tax, you pay $80 for the item plus $6.40 tax = $86.40 total. Some businesses may apply coupons differently, so always check the receipt. For digital goods and some service industries, discounts may be structured differently.

Both deals reduce your cost per unit by the same amount if you buy two units. With 50% off one item, you pay half price for that one item. With buy one get one free (BOGO), you buy two items at the price of one, which means 50% off per item when buying two. The key difference: a 50% discount requires no minimum purchase and applies to any quantity; BOGO requires purchasing two units to realize the savings. If you only need one item, a straight 50% discount is the better deal; if you need two, they're equivalent.

Not always. Retailers may calculate discounts from different base prices: the MSRP (Manufacturer's Suggested Retail Price), their own regular price, a seasonal original price, or a constructed reference price. This is why comparison shopping matters — a '40% off' label at one retailer might result in a higher final price than a '20% off' label at another, if the base prices differ substantially. Always compare final prices, not just discount percentages.

This calculator works with any currency — simply enter the price in your local currency without worrying about the dollar sign label. If you're shopping abroad or in a foreign currency, enter the original price in that currency, apply the discount percentage, and the result will be in the same currency. For cross-currency comparisons, you would then need to convert using the current exchange rate separately. The mathematical relationship between original price, discount, and final price is currency-agnostic.