Problem Solving

This is simple but I can't seem to get around this one. Especially with "determined a selling price that equaled the purchase price of the jacket plus a markup that was 25 percent of the selling price". Appreciate if someone could explain.


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

Use algebra to solve this problem:

A 25% markup is equivalent to multiplying the original price by 5/4

A 20% discount is equivalent to multiplying price by 4/5

Hence 60(5/4)(4/5) = 60

60 - 60 = 0 profit

IMO A

C.

determined a selling price that equaled the purchase price of the jacket plus a markup that was 25 percent of the selling price MEANS:

60+(1/4)S=S--->60=(3/4)S--->S=80

20% off 80=64--->64-60=4

rossmj wrote:C.

determined a selling price that equaled the purchase price of the jacket plus a markup that was 25 percent of the selling price MEANS:

60+(1/4)S=S--->60=(3/4)S--->S=80

20% off 80=64--->64-60=4

Thanks! OA is indeed C.