Question

Fred buys flags from a manufacturer for (unknown) dollars each then sells the flags in his store for a 26% markup.

Answer 1

The markup is 1.26 (the amount added is .26)

1.26x (when x is the price Fred buys them for from the manufacturer)

1.26(40)
$50.40 is the retail price


50.4-40 
$10.40 is the markup

Answer 2

Answer:

The 26% markup means that he is selling the flags 26% above the cost.

So, the cost would represent 100%, which is 1, and 26% of markup in decimal number is 0.26.

The price including the markup would be 1.26 as decimal or 126% as percentage.

The problem states that the cost is unknown, so we represent that with a variable x. The retail price would be 1.26x, which is 126% per flag.

Finally, if Fred paid $40 per flag, the actual retail price would be:

1.26($40)=$50.40.

With $10.40 of markup.