Question

The selling price for a used car at Smith's Auto Market was $17,700. Smith marks up the buying price by 12%. What was the buying price of the car? The buying price of the car was _______.

Answer 1

The buying price of the car was approximately $15,803.57, which is calculated by dividing the selling price of $17,700 by 1.12, to account for the 12% markup by Smith's Auto Market.

Step-by-step explanation:

Smith's Auto Market applies a markup, which we must reverse in order to determine the used car's buying price. In this scenario, the $17,700 that Smith's Auto Market charges for an automobile with a 12% markup is 112% of the purchase price.

Finding the initial price (P) prior to markup can be done using the following equation:

1.12 times P is $17,700.

We get the following when we divide both sides of the equation by 1.12:

P is equal to $17,700 / 1.12

After being rounded to two decimal places, P is $15,803.57.

This means that the car cost roughly $15,803.57 when it was purchased.