BREAKING: Target Test Prep releases Brand New 2026 On Demand GMAT prep course

Redeem

Target Test Prep · GMAT

Choose how you want to prepare

Learn live with an expert or move at your own pace. Every option includes the complete TTP study system.

★★★★★5.0559 reviews
GMATLiveTeach 7 seats left
Chris Peckover
NEXT LIVE COHORT

Oct 13 to Jan 7, 2027

with Chris Peckover

Schedule
Tue, Thu · 8:00 to 10:00 PM ET
Included
40 live hours + 6 months of GMAT OnDemand
  • Live instruction and real-time questions
  • Class recordings and assigned practice
View class & enroll
Limited cohort · enrollment openTarget Test Prep
EALiveTeach 5 seats left
Logan Thompson
EXECUTIVE ASSESSMENT

Sep 6 to Dec 6, 2026

with Logan Thompson

Schedule
Sun · 9:30 AM to 12:30 PM ET
Included
Live EA class + 6 months of EA OnDemand
  • Expert-led weekly online sessions
  • EA Masterclass access between classes
View EA class & enroll
Limited cohort · enrollment openTarget Test Prep
GMATOnDemand Start anytime
SELF-PACED MASTERCLASS

Target Test Prep GMAT OnDemand

Complete access from day one. Study on your schedule.

130-point score guarantee
$0to start then $127/mo
  • Personalized study plan and analytics
  • Thousands of lessons and practice questions
Start free 5-day trial
Read 559 reviewsTarget Test Prep

Compare the format, schedule, and included access before enrolling. Prices and seat counts shown reflect the supplied offer details.

A merchant purchased a jacket for $60 and then determined

Expert replies
Post new topic Post Reply
Previous Topic Next Topic
Moderator
Posts: 7187
Joined: Thu Sep 07, 2017 4:43 pmFollowed by: 23 members
by BTGmoderatorDC » Wed Dec 25, 2019 5:49 pm
A merchant purchased a jacket for $60 and then determined a selling price that equaled the purchase price of the jacket plus a markup that was 25 percent of the selling price. During a sale, the merchant discounted the selling price by 20 percent and sold the jacket. What was the merchant's gross profit on this sale?


A. $0

B. $3

C. $4

D. $12

E. $15




OA C

Source: Official Guide
Top
Join the discussion
Log in to postLogin with Googleuse password
QUOTE IN REPLY
Source: — Problem Solving |
Senior | Next Rank: 100 Posts
Posts: 62
Joined: Wed Nov 13, 2019 9:42 pm

by SampathKp » Thu Dec 26, 2019 3:08 am
BTGmoderatorDC wrote:A merchant purchased a jacket for $60 and then determined a selling price that equaled the purchase price of the jacket plus a markup that was 25 percent of the selling price. During a sale, the merchant discounted the selling price by 20 percent and sold the jacket. What was the merchant's gross profit on this sale?


A. $0

B. $3

C. $4

D. $12

E. $15

Cost price of Jacket = $60
Let the Selling Price of Jacket be X

Given Information X = 60+ X/4 ( Selling price is equal to Cost price ($60) + 25% of Selling price (X/4)

Solving for X in the above equation we get X = 80. But it is also given that merchant sold the jacket at 20% discount which is $64

Profit made by merchant is selling price after discount - purchase price . $64 -$60 = $4

Answer is C
Top
Join the discussion
Log in to postLogin with Googleuse password
QUOTE IN REPLY

GMAT/MBA Expert

User avatar
GMAT Instructor
Posts: 16207
Joined: Mon Dec 08, 2008 6:26 pmFollowed by: 1268 members
Location: Vancouver, BC
Thanked: 5254 times
GMAT Score:770

by Brent@GMATPrepNow » Thu Dec 26, 2019 7:12 am
BTGmoderatorDC wrote:A merchant purchased a jacket for $60 and then determined a selling price that equaled the purchase price of the jacket plus a markup that was 25 percent of the selling price. During a sale, the merchant discounted the selling price by 20 percent and sold the jacket. What was the merchant's gross profit on this sale?


A. $0

B. $3

C. $4

D. $12

E. $15




OA C

Source: Official Guide
Let x = the SELLING PRICE

A merchant purchased a jacket for $60 and then determined a selling price that equaled the purchase price of the jacket plus a markup that was 25 percent of the selling price.
We can write: x = $60 + (25% of x)
In other words, x = $60 + 0.25x)
Subtract 0.25x from both sides to get: 0.75x = 60
Divide both sides by 0.75 to get: x = 80
So the selling price is $80

During a sale, the merchant discounted the selling price by 20 percent and sold the jacket.
We can write: DISCOUNTED price = $80 - (20% of $80)
= $80 - (0.20)($80)
= $80 - $16
= $64

What was the merchant's gross profit on this sale?
Gross profit = $64 - $60 = $4

Answer: C

Cheers,
Brent
Brent Hanneson - Creator of GMATPrepNow.com
Image
Top
Join the discussion
Log in to postLogin with Googleuse password
QUOTE IN REPLY
Post new topic Post Reply
• Page 1 of 1