A particular style of earrings costs the retailer $85 per pair. At what price should the retailer mark them so he can sell them at 15% discount off the original price and still make 25% profit?

Answer 1

Let M = Marked Price or Selling Price

Cost = $85

25% Profit = (1.25) (Cost) = (1.25) (85)

15% Discount = .85M

.85M = (1.25) (85)

.85M = 106.25

M = $125.00

CHECKING:

Cost = $85

25% Profit = 125% of $85 = 1.25 x $85 = $106.25

85% of the Marked Price must equal $106.25.

Or, 15% discount of $125 = 85% of $125 = (.85) ($125) = $106.25

Hope this helps you Tori.