If Massachusetts has a sales tax of 6 percent and New Hampshire has no sales tax, how much money can be saved by buying a $1,000 television in New Hampshire?

• A. $0
• B. $60
• C. $100
• D. $6

Answer: (B)

This question tests how sales tax differences affect total cost when buying something. Massachusetts charges 6% sales tax, so a $1,000 television would have $60 added in tax there. New Hampshire has no sales tax, so the tax would be $0. The savings come from avoiding that $60 tax, so you’d save $60 by buying in New Hampshire. The other dollar amounts don’t fit because they would imply different tax amounts (0 would mean no savings at all, $100 would imply a 10% tax on $1,000, and $6 would imply only 0.6%), which don’t match the given 6% rate.