A retailer purchases shirts from a wholesaler and then sells the shirts in her store at a retail price that is 80...

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Magoosh

A retailer purchases shirts from a wholesaler and then sells the shirts in her store at a retail price that is 80 percent greater than the wholesale price. If the retailer decreases the retail price by 30 percent this will have the same effect as increasing the wholesale price by what percent?

A. 26
B. 37.5
C. 42
D. 44
E. 50

OA A

[Scott@TargetTestPrep]

Magoosh

A retailer purchases shirts from a wholesaler and then sells the shirts in her store at a retail price that is 80 percent greater than the wholesale price. If the retailer decreases the retail price by 30 percent this will have the same effect as increasing the wholesale price by what percent?

A. 26
B. 37.5
C. 42
D. 44
E. 50

OA A

Solution:

We can let the wholesale price be $100. So the original retail price is 100 x 1.8 = $180, and the reduced retail price is 180 x 0.7 = $126. We see that the reduced retail price of $126 is 26% more than the wholesale price of $100.

Answer: A