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A department store marks up its clothing 80% over cost. If it sells blue jeans for $14, how much did the store pay for them?
The correct answer is (A).
A store markup of 100% would exactly double the price. An 80% markup almost doubles the price. The $14 jeans are priced at almost double their cost to the store. By estimation, the best answer choice is (A). To figure precisely, remember than an 80% markup is the equivalent of multiplying the cost by 180%, or 1.80.
cost * 1.80 = 14
cost = 14/1.80
cost = $7.78