Determining the Final Cost of an Item The tax rate as a percent, r, charged on an item can be determined using the formula StartFraction c Over p EndFraction minus 1 equals r. – 1 = r, where c is the final cost of the item and p is the price of the item before tax. Louise rewrites the equation to solve for the final cost of the item: c = p(1 + ). What is the final cost of a $40 item after an 8% tax is applied?