Video narration
Can a shop discount an item and still make a profit? Follow one jacket through the shop. The shop pays $10 for it: that's the cost price, what the shop paid. It sets a $15 marked price, the price before a discount. Adding $5 to the cost to set that price is the markup. Then a customer gets $3 off and pays $12. The $3 taken off is the discount, and $12 is the selling price, what the customer actually pays. But a discount does not tell you whether the shop made a profit. Compare the selling price with the cost price. Markup and discount describe price changes; profit and loss describe the sale compared with cost. Above cost means profit; below cost means loss. So yes: pay $10, sell for $12 after a discount, and the shop makes $2 profit.