Final answer:
Markdowns as a percentage are calculated by subtracting the new price from the original price and dividing by the original price, then multiplying by 100. This reflects the markdown as a proportion of the original price. The calculation of a price index differs and relates to adjusting nominal figures to real figures.
Step-by-step explanation:
Markdowns expressed as a percentage are calculated by subtracting the new price from the original price and dividing the difference by the original price. This gives the markdown as a decimal fraction, and to convert it to a percentage, you multiply this decimal by 100. This approach is used to show the markdown as a proportion of the original price.
To illustrate with an example, let's say the original price of an item is $50, and it has been marked down to $40. We calculate the markdown percentage by taking ($50 - $40) / $50 = 0.20. To express this as a percentage, we multiply 0.20 by 100, which gives us a 20% markdown.
The concept of the price index and its adjustment by dividing by 100 when using published figures is related to adjusting nominal figures to real figures, but it is not directly related to the calculation of markdown percentages.