Why doesn’t 20% discount followed by a 20% markup get you back to where you started?
After you make a 20 percent discount, that amount is being marked up by 20 percent, so it is impossible for you to get back where you started. For example, there is a 20 percent of from 100, that will be 100x(1-20%)= 80, and then 80 is marked up by 20 percent, not 100 therefore,20% discount followed by a 20% markup won’t get you back to where you started.
How do companies make a profit?
Companies make profits by selling the product by increasing the cost. Some of the companies increases their profit by doing promotions and giving out coupons which can attract many customers but is totally useless.
Is it possible for everyone to win in the marketplace?
It is not possible for everyone to win in the marketplace because things are inflating. The cost(employees, materials for the product) cost more and more every year and then you’ll have to sell the product in a high cost that customers might think that its not worth buying it. But if they lower the price of the product, the company couldn’t make profit and there might be a bankruptcy.