A retailer pays $90 to a wholesaler for an article. The retail price is set using a 40% rate of markup on selling price. To increase traffic to his store, the retailer marks the article down 20% during a sale. What is the sale price? (Round your answer to the nearest whole number.)
Question
A retailer pays $90 to a wholesaler for an article. The retail price is set using a 40% rate of markup on selling price. To increase traffic to his store, the retailer marks the article down 20% during a sale. What is the sale price? (Round your answer to the nearest whole number.)
Solution
Sure, here are the steps to solve the problem:
Step 1: Determine the retail price. The retailer uses a 40% rate of markup on the selling price. This means the cost represents 60% (100% - 40%) of the retail price. So, we can set up the equation: 0.60 * Retail Price = 150.
Step 2: Determine the sale price. The retailer marks the article down 20% during a sale. This means the sale price is 80% (100% - 20%) of the retail price. So, we can set up the equation: 0.80 * Retail Price = Sale Price. Substituting 150 = $120.
So, the sale price of the article is approximately $120.
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