Dropdown list + Selected value

I am trying to customize the walkthrough for Tax (http://gravityhelp.com/documentation/page/Gravity_Forms_Pricing:_Adding_Tax).
But in my case, I want the tax rate to vary based on a preselected item from a dropdown list.
So for example
if you selected option 1 from the specified dropdown, then ur tax rate is X%, if you selected 2, your rate will be Y% etc.
How do I use/call up the value/item in the selected field? What filter/function/code can I use to acieve this?

See part of what I have so far in my functions.php

add_filter('gform_pre_render_3', 'add_total_script');
	function add_total_script($form) {
	    ?>
    <script type="text/javascript">
   	 function gform_product_total(formId, total){
         var rate = 0;
	if ($(".ginput_3_20 option:selected").text()) == "Option1_selected"){
        rate = 20; } else {
        if ...................................// an so on
        } else {
        rate = 100;
        }  //end if
        var tax = ((rate * total) / 100);  //calculate the tax to be paid and add below;
        return total + tax;
    }
    </script>

<?php
    return $form;
}

Works Great. But How do I 'monitor' the dropdown, should the user change it.
The form calculates based on the selection, but doesnt update if for instance I go back and change the value in the dropdown.
Regards,

It kind of did not work.
Here is what I have. http://www.pastie.org/3360944
The other one worked better except the lack of communicating change in selection. Any ideas?

Ok I think I got it to work.
Check http://www.pastie.org/3361172
I changed
taxRateField.change(function(){
to
jQuery(document).ready(function(){
jQuery('select#input_3_21').bind('change', function(){
Removed the - var taxRateField = jQuery('select#input_3_21'); and referred to it directly as jQuery('select#input_3_21') in all instances
Then somewhere along I keep displaying the rate, to verify that it changes and let the user know.

I hope it continues to work. Any redundant line or better way?

Thanks y'all

Now left with one other issue: THE BACKEND TOTAL
For the backend total, GF Example used a fixed figure, 20, how can I incorporate the tax value (based on selection).

add_filter('gform_product_info_78', 'update_product_info', 10, 3);
function update_product_info($product_info, $form, $entry) {
$total = get_total($product_info);
$tax = (20 * $total) / 100; // update the "20" to the desired tax percentage
.........

how do I change that '20' to pick the tax value?
Thanks