Solve the problem. Round rates to the nearest tenth of a percent and dollar amounts to the nearest cent.
-Bob's Tires manufactures steel-belted radials at a cost of $53.66 each. Bob then sells the tires at a 44.8% markup based on cost. Find (a) the markup, (b) the selling price, and (c) the markup as a percent of selling price
A)(a)$24.04
(b)$77.70
(c)30.9%
B)(a)$24.04
(b)$77.70
(c)44.8%
C)(a)$119.78
(b)$173.44
(c)223.2%
D)(a)$119.78
(b)$173.44
(c)69.1%

Question

Quizplus · Accepted Answer

(a) Markup = Cost x Markup Rate = $53.66 x 44.8% = $24.04
(b) Selling Price = Cost + Markup = $53.66 + $24.04 = $77.70
(c) Markup as a percent of selling price = (Markup/Selling Price) x 100% = ($24.04/$77.70) x 100% = 30.9%. Therefore, the best choice is A. (a) Markup = Cost x Markup rate

Markup rate = 44.8%

Markup = $53.66 x 0.448 ≈ $24.04

(b) Selling price = Cost + Markup

Selling price = $53.66 + $24.04 ≈ $77.70

(c) Markup rate based on selling price = (Markup/Selling price) x 100%

Markup rate based on selling price = ($24.04/$77.70) x 100% ≈ 30.9%

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