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ps1000 - set 7 merchant question

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Manager
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Joined: 02 Oct 2005
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ps1000 - set 7 merchant question [#permalink] New post 30 Jan 2006, 04:19
00:00
A
B
C
D
E

Difficulty:

(N/A)

Question Stats:

0% (00:00) correct 0% (00:00) wrong based on 0 sessions
A merchant purchased a jacket for $60 and then determined a selling price that equalled the purchase price of the jacket plus a markup that was 25 percent of the selling price. During a sale, the merchant discounted the selling price by 20 percent and sold the jacket. What was the merchant’s gross profit on this sale?
(A) $0
(B) $3
(C) $4
(D) $12
(E) $15

I think the ans is clearly (A), however, it is mentioned as (C) in the ans set.
Intern
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 [#permalink] New post 30 Jan 2006, 05:58
its C.

PP = 60

sp = PP + (25/100) * sp

==> sp = 80

but sold @ 20% discount ==> sp * 80/100 ==> 64 $

==> 64-60 = 4 $ is the gross profit.
CEO
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GMAT Tests User
 [#permalink] New post 28 May 2007, 23:44
nenuphani wrote:
its C.

PP = 60

sp = PP + (25/100) * sp

==> sp = 80

but sold @ 20% discount ==> sp * 80/100 ==> 64 $

==> 64-60 = 4 $ is the gross profit.


thanks.

retail = cost + (1/4)*(retail)
x = 60 + 1/4(x)
4x= 240 + x
3x = 240
x=80

80*(.8)=64

64-60=4

:lol:
GMAT Club Legend
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GMAT Tests User
 [#permalink] New post 29 May 2007, 01:16
Seling price of jacket, S = 60+0.25S -> 0.75S = 60 -> S = 80
Selling price of jacket at sale = 0.8 * 80 = 64 dollars.

Overall profit = 4 dollars.
  [#permalink] 29 May 2007, 01:16
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