SassMeister gist for http://stackoverflow.com/questions/27573851/sass-marking-a-variable-as-a-string

SassMeister-input-HTML.html

<nav>
    <ul>
        <li>Item 1</li>
        <li>Item 2</li>
        <li>Item 3</li>
    </ul>
</nav>

SassMeister-input.scss

// ----
// Sass (v3.4.9)
// Compass (v1.0.1)
// ----

$size-base: 1em;
$size-increment: 0.1em;
$size-list: "%xs", "%sm", "%md", "%lg";

@each $value-size in $size-list {
  $size-base: $size-base + $size-increment;
  #{$value-size} {
    font-size: $size-base;
  }
}

h2 {
  @extend %lg;
}

SassMeister-output.css

h2 {
  font-size: 1.4em;
}

SassMeister-rendered.html

<nav>
    <ul>
        <li>Item 1</li>
        <li>Item 2</li>
        <li>Item 3</li>
    </ul>
</nav>