Question

A sold a good to B at a profit of 25% and B sold the good to C at a profit of 20%. If C paid $450 for the good what was the cost paid by A?

Answer 1

i dont get it sir...

Answer 2

Ok so let's work backwards.

Answer 3

If C paid $450 and B sold it to him from the markup of 20%, then B had to have had an amount of money that when marked up by 20% yielded $450 right? Are you with me so far?

Answer 4

yes got your this point

Answer 5

So we ask ourselves what amount of money, when marked up by 20%, will give us $450?

Answer 6

x + 0.2x = $450 right?

Answer 7

yes

Answer 8

So we have 1.2x = $450

If we divide both sides by 1.2, we get $37.5

So B must have had $37.5 less than the $450 that C got. I think.

Answer 9

right....

Answer 10

Don't use what I have put here, I think I am wrong.

Answer 11

@Cosmichaotic

This statement is correct:

So we have 1.2x = $450

Answer 12

@Cosmichaotic

This statement is incorrect, but I fixed it in the line below:

If we divide both sides by 1.2, we get $37.5

If we divide both sides by 1.2, we get $375

Now you know that B bought it from A for $375.
Now continue the same way you started. You're doing a good job.
Now ask yourself the same type of question you asked above, but this time it's with a 25% markup.

Answer 13

So we would say that:

1.25x = $375
And x = $300

So A must have had $300?

Answer 14

Correct.
Great job, @Cosmichaotic.

To check, raise $300 by 25% and then by 20%, and see if you get $450.
$300 * 1.25 * 1.2 = $450.
That means $300 is correct.