Question

If the markup is 20% and the selling price is $45.00, what is the initial price

Answer 1

The original cost was $37.50.

Explanation:

Since there is a 20% mark up, we know that we are paying 120% of the initial price. So, to find the original price, we take the current cost and divide by 120% (or 1.20).

$45.00/1.20 = $37.50