Section: Principles of Marketing

17) What is the cost at retail of a product that sells for $400.00 and has a markdown percent of 40%?

1. $120.00
2. $180.00
3. $240.00
4. $300.00
5. $360.00

Because

Retail Selling Price = Cost - (Cost * Markdown Percent)

or even easier

Retail Selling Price = Cost * (1 - Markdown Percent)


Therefore, Price = 400 * (1 - .4) or 400 * .6 yielding $240.00.