Question

What price should a retailer place on an item that costs him $6.95, if he wants a markup of 33%? $

Answer 1

To determine the retail price of an item with a cost of $6.95 and a desired markup of 33%, you can use the following formula:

\[
\text{Retail Price} = \text{Cost} + (\text{Cost} \times \text{Markup Percentage})
\]

1. First, calculate the markup amount:
\[
\text{Markup Amount} = \text{Cost} \times \text{Markup Percentage}
\]
\[
\text{Markup Amount} = 6.95 \times 0.33 = 2.2935
\]

2. Then, calculate the retail price:
\[
\text{Retail Price} = \text{Cost} + \text{Markup Amount}
\]
\[
\text{Retail Price} = 6.95 + 2.2935 = 9.2435
\]

3. Finally, rounding to two decimal places, the retail price should be:
\[
\text{Retail Price} \approx 9.24
\]

Thus, the retailer should set the price at **$9.24**.