The question is asking us to find tax on an amount of $1,540 at the rate of [tex]7\frac{1}{4}%[/tex] Percent means out of 100.
[tex]7\frac{1}{4}=\frac{29}{4}=7.25.[/tex]
7.25% =0.0725.
To find the tax to be paid we need to find 0.0725 of 1,540.
Tax to be paid = 0.0725x1540=111.65.
Tax on amount of $1540 at the rate of tex]7\frac{1}{4}%[/tex] is $111.65.
Option c. $111.65 is the right answer.
