Question

The selling price of a refrigerator, is $648.90. If the markup is 5% of the dealer's cost, what is the dealer's cost of the refrigerator?

Answer 1

$467.20

Explanation:

Step 1

Let's represent one of the unknown quantities.

We will let:

x= the dealer's cost for the refrigerator (before the markup is added).

Step 2

Let's represent other unknown quantities in terms of xx.

There are no other unknown quantities, so we can skip this step.

Step 3

Now we write an equation in xx that models the conditions.

The dealer's cost plus the 25% markup is the selling price, 584$:\ x + 0.25x = 584x + 0.25x = 584.

Step 4

x + 0.25x = 584

x(1+0.25)= 584

1.25x=584

125x = 584

1.25 = 1.25

​

x=467.20

We solve the equation and answer the question.

We find that the dealer's cost before adding markup was $467.20.

Step 5

Finally we check the proposed solution in the original wording of the problem. The dealer's cost before adding the markup, 467.20$, plus the 25% markup, should equal the final price given in the original wording. 584$. This verifies that the dealer cost before adding the markup was 467.20$. So the answer is $467.20.

Hope this helps you!