Lesson on Markup and Discounts

Discounts and Markups

by Isaac Mairura

​Discounts and Markups

• ​Discounts are often said as savings, price reduction, markdown, sale, and clearance.

• ​Calculating a discount is like calculating tax, but because you saving money, you subtract it from the original price.

• ​Good luck!

Multiple Choice

A new hat costs $12.50. A sign in the window says, "ALL ITEMS 20% OFF." What is the discount off of the hat, and what is the new price of the hat?

• $10.00

• $10.50

• $9.50

• $11.55

Multiple Choice

Valery's Video's is selling all games at a 25% discount. However, you also have a membership card to the store, which gives you an additional 15% discount. What will you end up paying for $100 dollars worth of video games?

• $73.65

• $56.37

• $63.75

• $37.65

​On the last one, don't forget that the second discount is additional, so it's calculated based on the first discounted price, NOT the original price.

Finding the Original Price

​

​You can also find the original price if you know the final price and the discount.

​First, subtract the percent of the discount from the original cost.

​Two, convert the percent to a decimal.

​Last, solve for the original price.

Multiple Choice

A video game is on sale for 30% off of the regular price. If the sale price is $41.99, what was the original price? (rounding to the nearest cent)

• $60.00

• $69.99

• $59.99

• $49.99

​Finding the Percent Discount

• ​Similarly (to the last question), you can also find the percent discount if you know the original and final price.

Multiple Choice

Julie paid $35 for a shirt that is on sale. If the original price was $50, what was the percent discount?

• 30%

• 40%

• 29%

• 50%

​Markups

• ​Stores often use discounts during sales. But if they did that all the time, they would probably go out of business. In fact stores and manufacturers usually increase their products to make a profit. These increases are known as markups.

​Markups

• ​First, change the percent discount to a decimal.

• ​Second, Multiply the decimal by the original cost. This is the markup.

• ​Then last, add the markup price to the original cost.

• ​Good luck!

Multiple Choice

A video game costs $40 to make. To make a profit, a manufacturer marks it up by 20%. What is the markup amount, and what is the new price of the game?

• $49

• $47

• $48

• $46

​Finding the Original Cost

• ​Just like when you calculate for taxes and fees, you can also find the original cost if you know the final price and the markup.

• ​First, add the percent of the original cost and percent of the markup to get the total cost percent.

​Finding the Original Cost (continued)

• ​Second, convert the percent to a decimal.

• ​And third, solve for the original cost.

Multiple Choice

A bakery charges $5.08 for a cake. In order to make a profit, the store marks up its goods by 70%. What is the original cost of the cake?

• $2.89

• $2.79

• $3.09

• $2.99

​Notice that on the first step of the last question, that you paid the original price plus the store's markup, so the cost of the cake is actually 170% of the original cost.

Multiple Choice

A manufacturer makes a bookshelf that costs $50. The price at the store is increased by a markup of 8%. What is the markup amount and the new price?

• Markup: $5 New Price: $44.00

• Markup: $4 New Price: $54.00

• Markup: $6 New Price: $64.00

• Markup: $7 New Price: $74.00