Question

The retail selling price of an item, R, was $20.70. If it cost, C, to the store was $18, what was the markup rate, r?

a) 15%
b) 13.3%
c) 12.5%
d) 10%

Answer 1

The markup rate is found by dividing the markup amount ($2.70) by the cost to the store ($18.00) and then converting to a percentage, resulting in a 15% markup rate.

Step-by-step explanation:

To calculate the markup rate, r, we first need to find the markup amount by subtracting the cost from the retail selling price. The markup amount is $20.70 (R) - $18.00 (C) = $2.70. Next, to find the markup rate, we divide the markup amount by the cost to the store, and then convert it to a percentage.

Markup rate, r = ($2.70 / $18.00) × 100 = 15%.

Therefore, the markup rate, r, is 15%, which corresponds to option (a).