Question

Bottled water costs $1.25 in the vending machine. This price is the markup from the wholesale cost of $0.20. What is the markup, as a percent?

Answer 1

Let's begin by listing out the information given to us:

Bottled water = $1.25

Markup = $0.20

`\begin{gathered} OriginalCost+Markup=SalePrice \\ Markup=0.25,SalePrice=1.25 \\ OriginalCost=1.25-0.25 \\ OriginalCost=1.25-0.25=1.00 \\ OriginalCost=1.00 \end{gathered}`

Markup percent is given by the ratio of the Markup to the Original cost:

`\begin{gathered} 0.25\colon1.00 \\ \text{Divide both sides by 0.25, we have:} \\ (0.25)/(0.25)\colon(1.00)/(0.25)\Rightarrow1\colon4 \\ 1\colon4\Rightarrow(1)/(4)=0.25 \\ 25\text{percent} \end{gathered}`

Therefore, the markup is 25% of the original cost