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Last year Madd Hatter, Inc. bought baseball caps for $3 each and sold them for $9. This year, the company’s supplier is charging $4 for each cap, but Madd Hatter cannot raise its prices because competition is too tough. If Madd Hatter continues to sell caps for $9, its gross profit per cap will __________ and its gross profit ratio will __________.

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The gross profit per cap will decrease and the gross profit ratio will decline
User Rutesh Makhijani
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