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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] A 20-lb turkey has a 35% markup & is selling for a price of $22.50. Use the selling price formula to compute the original cost of the turkey. Round to the nearest cent.[B] A carton of eggs originally costs the store $0.98, but to make money, the store wants to have an 85% markup on the carton of eggs. Use the selling price formula to find the new price of the eggs. Round to the nearest cent. Show all work to receive full credit.
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