ps1000 - set 7 merchant question : PS Archive
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# ps1000 - set 7 merchant question

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ps1000 - set 7 merchant question [#permalink]

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30 Jan 2006, 04:19
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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 merchantâ€™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.
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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.
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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

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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.
29 May 2007, 01:16
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