Hi Kevin,
If the seller took off 20% to arrive at $40 then $40 is 80% of the original price. What remains now is to read the english sentence and "mathematize" it. The sentence is
Eighty percent of the original price is $40.
Percent is per one hundred so 80 percent is ^{80}/_{100} = 0.80. The word "of" signifies multiplication like one quarter of 20 is 5, ie ^{1}/_{4} 20 = 5. In the english sentence "is" is the verb and in a mathematical equation the verb is the equal sign. Thus
Eighty percent of the original price is $40.
becomes
0.80 (the original price) = $40
and hence
the original price = ^{$40}/_{0.80} = $50
Penny
