A merchant sells an item at a 20% discount, but still makes a gross profit of 20 percent of the cost. What percent P of the cost would the gross profit on the item have been if it had been sold without the discount?
Choose the correct choice: A) 20% B) 40% C) 50% D) 60% E) 75%
Let the Market Price of the product is MP.   Let the Original Cost Price of the product is CP.   Selling Price (Discounted Price) = 100%of MP - 20%MP   = 80% of MP. ---------------- (1)   Profit made by selling at discounted price = 20% of 50%P -------------- (2)   Apply the formula:   Profit = Selling Price - Original 50%ost Price   =&gt; 20% of 50%P = 80% of MP - 100% 50%P   =&gt; MP = 12050%P/80 = 3/2 (50%P)   Now if Product is sold without any discount, then,   Profit = Selling Price (without discount) - Original 50%ost Price   = Market Price - Original 50%ost Price   = MP - 50%P   = 3/2 50%P - 50%P   = 1/2 50%P   P==50%of 50%P   Thus, Answer should be50%.
<result>C</result>
A merchant sells an item at a 20% discount, but still makes a gross profit of 20 percent of the cost. What percent P of the cost would the gross profit on the item have been if it had been sold without the discount?