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Buying gold - inefficient use of money?

Today, the family had an evening outing, accompanying a friend to buy gold. The friend bought around 11 grams of gold at Rs 2,700 per gram. On top of that, making charges were 13% and tax of 1%.
Buying jewllery as an investment is clearly a waste of money. First, the price charged was Rs 150 higher than market price. And on top of that, 14% went off as making charges. A total of Rs 5,808 was wasted on a total spending of Rs 33,858. See the calculation below

weightPrice per gramTotal price 
Gold11 gramsRs 2,70029700 
Making charges (13% of gold price)  3861 
Tax at 1%  297 
  TOTAL PRICE33858 
 
EXCESS PAID    
Market price of gold Rs 2,550 per gram   
Excess amount1650(Rs 150 * 11 grams)  
Making charges3861   
Tax297   
TOTAL EXCESS AMOUNT5808  

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