Question

Mary buys 8 widgets for $40.00 she adds $1.00 in enhancements to each widget and sells them for $9.00 each. What is Mary's estimated gross profit margin?

Answer 1

The gross profit margin is calculated using the following rule:
gross profit margin = total profit / total sales

Now, we need to get the values of total profit and total sale:
total profit = 9*8-(40+8)=24$
total sales = 9*8 = 72$

Now, we will substitute in the above equation:
gross profit margin = 24/72 = 1/3 = 0.3333334
% = 0.33333334*100 = 33.3334%