Question

The cost to make to a dress is $25.00. The designer wants to charge a 70% mark up.

1. What is the selling price?

2. If they sell 20 dresses, what is the ROI?

Answer 1

To calculate the selling price and the Return on Investment (ROI), let's break it down step by step.

### 1. Calculating the Selling Price
The cost to make the dress is $25.00, and the designer wants to apply a 70% markup.

**Markup Calculation:**
\[ \text{Markup} = \text{Cost} \times \text{Markup Percentage} \]
\[ \text{Markup} = 25.00 \times 0.70 = 17.50 \]

**Selling Price Calculation:**
\[ \text{Selling Price} = \text{Cost} + \text{Markup} \]
\[ \text{Selling Price} = 25.00 + 17.50 = 42.50 \]

So, the selling price of the dress is **$42.50**.

### 2. Calculating the ROI from Selling 20 Dresses
To find the ROI, we need to determine the total profit from selling 20 dresses and then calculate the ROI based on the initial investment (cost).

**Total Revenue:**
\[ \text{Total Revenue} = \text{Selling Price} \times \text{Number of Dresses} \]
\[ \text{Total Revenue} = 42.50 \times 20 = 850.00 \]

**Total Cost:**
\[ \text{Total Cost} = \text{Cost} \times \text{Number of Dresses} \]
\[ \text{Total Cost} = 25.00 \times 20 = 500.00 \]

**Profit Calculation:**
\[ \text{Total Profit} = \text{Total Revenue} - \text{Total Cost} \]
\[ \text{Total Profit} = 850.00 - 500.00 = 350.00 \]

**ROI Calculation:**
\[ \text{ROI} = \left( \frac{\text{Total Profit}}{\text{Total Cost}} \right) \times 100\% \]
\[ \text{ROI} = \left( \frac{350.00}{500.00} \right) \times 100\% = 70\% \]

Thus, the ROI from selling 20 dresses is **70%**.