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Math Help - Normal mark-up on a discounted item?

  1. #1
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    Normal mark-up on a discounted item?

    A store sells a TV at a 25% discount but still makes a gross profit of 25% of the cost. What is the normal mark-up (i.e. profit without the discount)??

    I think the answer is 50% but I can figure out how to rationally set the problem up to get this answer.
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  2. #2
    Grand Panjandrum
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    Quote Originally Posted by thecapaccino View Post
    A store sells a TV at a 25% discount but still makes a gross profit of 25% of the cost. What is the normal mark-up (i.e. profit without the discount)??

    I think the answer is 50% but I can figure out how to rationally set the problem up to get this answer.
    Let the cost be c, and the normal mark-up x, then the bormal price is:

    P = c(1+x)

    discounting this by 25% means the store sells for:

    D = 0.75 P

    which is a gross profit of 25%, so:

    D = 1.25 c

    so we have:

    0.75 c (1+x) = 1.25 c

    which after cancelling the c and rearranging gives:

    (1+x) = 1.25/0.75 ~= 1.667,

    so th normal markup is ~=0.667 of 66.7%.

    RonL
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  3. #3
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    Is there an alternative method?

    I do get this method of solving the problem...but I am just wondering if you have another way to solve the problem.

    I think I would have a tough time solving a similar equation. If not, then that is fine...just trying:-)
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