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Question: A grocery store may increase the original price of a product to cover the expenses of running the store. The markup is the amount that is added to the original cost to create the selling price (the price the consumer pays) of the groceries. The percent markup is called the markup rate & is usually expressed as a percent of the original price. Taking the original cost & adding the markup calculates the selling price of an item. The formula S = C + rC can be used to help find the selling price. The selling price, S, is equal to the original cost, C, plus the markup rate, r, multiplied by the original cost, C (Aufmann, Vernon, & Lockwood, 2006).
Using the aforementioned information, solve the following problems.[A] The grocery store paid $1.99 for a 24-pack of bottled water & sold the case of water for $6.25. Compute the markup rate; round to the nearest tenth of a percent.[B] Using the formula S = C + rC, find another formula that represents the markup rate.
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