Multiple choice

A bookstore purchases a set of encyclopedias for $400. The store decides to increase the price by 25% before offering a 15% discount to customers. What should be the marked price of the encyclopedias?

  1. $500
  2. $480
  3. $420
  4. $410
  5. $400
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A Correct answer
Explanation

Cost = 400. Increase by 25% = 400 * 1.25 = 500. Discount of 15% on 500 = 500 * 0.85 = 425. The question asks for the marked price, which is 500.

AI explanation

The bookstore increases the cost price of \$400 by 25% to find the marked price using the formula Marked Price = Cost Price + (Markup Percentage of Cost Price). The markup amount is 25% of \$400, which equals \$100. Adding this markup to the original cost price gives \$400 + $100 = $500.

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