



 
Adrian, The important question here is percentage of what? In your calculation you add 5% of your price, $100, to get $100 + 0.05 × $100 = $105. Your associate on the other hand is looking at this problem from your customer's point of view., Your customer sees his cost, $x, and says that the markup is 5% of his cost. Hence your cost is 95% of his cost, $x, that is $100 = 0.95 × $x and thus $x = 100/0.95. Penny  


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