Section: Mathematics

20) A computer store regularly sells all stock at a discount of 20 percent to 40 percent. If an additional 25 percent were deducted from the discount price during a special sale, what would be the lowest possible price of a part costing $16 before any discount?

1. $6.80
2. $7.20
3. $9.60
4. $11.30
5. $14.80

The lowest possible price is paid when the maximum discount is received, so the lowest possible regular price is $16 - 0.40($16) = $9.60. With an additional 25 percent discount, the lowest possible price is $9.60 - 0.25($9.60) = $7.20. The best answer is the second one.

Alternatively, the lowest possible price to be paid for the item can be calculated by realizing that if you are being given a discount of 40 percent you are paying 60 percent of the listed price of the item. If an additional 25 percent discount is offered on the item, the price of the item becomes (0.75)(0.60)($16) = $7.20.