Multiple choice

If a retailer offers a discount of 20% on the marked price of his goods and ends up selling at cost price, then what was the % mark up?

  1. 20%

  2. 25%

  3. 30%

  4. 40%
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Let CP = 100. Selling Price = 100. Discount = 20% of MP. 100 = MP - 0.2*MP = 0.8*MP. MP = 100/0.8 = 125. Markup = (125-100)/100 = 25%.

AI explanation

Let the cost price be 100. Since the retailer offers a 20% discount on the marked price and sells the item at cost price, the selling price is 100. Using the formula Marked Price = (Selling Price * 100) / (100 - Discount), we get Marked Price = (100 * 100) / 80 = 125. The markup percentage is calculated as ((125 - 100) / 100) * 100 = 25%.

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