A store increases the price of an item by 25% and then offers a 20% discount. Wh

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Question: A store increases the price of an item by 25% and then offers a 20% discount. What is the net percentage change in price?

Options:

Correct Answer: 5% increase

Solution:

Let the original price be $100. New price = 125. After discount = 125 - (20/100 * 125) = 100. Net change = 0%.

A store increases the price of an item by 25% and then offers a 20% discount. What is the net percentage change in price?

A store increases the price of an item by 25% and then offers a 20% discount. What is the net percentage change in price?

Correct Answer: 0%

Step 1: Assume the original price of the item is $100.
Step 2: Calculate the new price after a 25% increase. This is done by multiplying the original price by 1.25 (which is 100% + 25%). So, 100 * 1.25 = $125.
Step 3: Calculate the discount amount. The store offers a 20% discount on the new price of $125. This is done by multiplying $125 by 0.20. So, 125 * 0.20 = $25.
Step 4: Subtract the discount from the new price to find the final price. So, $125 - $25 = $100.
Step 5: Compare the final price to the original price. The final price is $100, which is the same as the original price.
Step 6: Calculate the net percentage change in price. Since the final price is the same as the original price, the net change is 0%.

Percentage Increase and Decrease – Understanding how to calculate percentage increases and decreases in price.
Net Change Calculation – Determining the overall effect on price after applying both an increase and a discount.