A price rises by 20 percent and then falls by 20 percent. What is the net change?
Answer and explanation
Correct answer: D. A decrease of 4 percent
- Step 1: Multiply: . Step 2. The final price is 96 percent of the original, a 4 percent fall. Answer: A decrease of 4 percent. Why not the others: No change assumes the percentages cancel, which they do not because they apply to different bases.
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