Answer: B

Initially, the price of the product is given by:
p = xy
where p is the price, x is the number of ounces, and y is the price per ounce.

The number of ounces then changes to 1.25x, and the price per ounce decreases, but we don't know by how much. So say that the price per ounce is now qy, where q is the fraction of the original price represented by the new price. (If the old price was $10 and the new price is $9, q = 0.9.)

Thus:
p=(1.25x)(qy)
We now have two expressions that are equal to p, so we can set them equal to each other:
xy = (1.25x)(qy)
1 = 1.25q
q = (1/1.25) = (1/(5/4)) = (4/5)=0.8
If the new price is 0.8 of the old price, that's a decrease of 20%, choice (B).