Question

Production of product costs $8 and selling product for $15 how to calculate the mark up

Answer 1

87.5%

Explanation:

We are given the following information:

• A product costs $8 to produce.
• It is sold for $15.

A product's "mark up" is the percent difference between the sale price and the cost of production in relation to the cost of production.

We can find the mark up for this product by:

1. finding the actual difference between the sale price and cost of production
2. dividing that by the cost of production
3. converting the resulting value to a percent

Step 1

actual difference = $15 - $8

actual difference = $7

Step 2

mark up = (actual difference) / (cost of production)

= $7 / $8

= 0.875

Step 3

mark up = (0.875 × 100) %

mark up = 87.5%