Question

A dress was initially listed at a price that would have given the store a profit of 20% of the wholesale cost. What was the wholesale cost of the dress?
A. After reducing the listed price by 10%, the dress sold for a net profit of $10.
B. The dress is sold for $50.

• A. The question can be answered by one of the statements alone but not by the other.
• B. The question can be answered by using either statement alone.
• C. The question can be answered by using both the statements together, but cannot be answered by using either statement alone.
• D. The question cannot be answered even by using both statements together.

Hint:

Use percentage calculations to work out profit margins and cost values. Adjust prices based on changes such as discounts.

Answer 1

The Correct Option is A

Let the wholesale cost be \( C \). The dress was initially priced at \( C + 0.20C = 1.20C \). After reducing the listed price by 10%, the dress was sold at \( 0.90 \times 1.20C = 1.08C \). The dress was sold for $50, so: \[ 1.08C = 50 \Rightarrow C = \frac{50}{1.08} = 50 \] Thus, the wholesale cost is \$50.