Question

The cost to a store for an MP3 player is $60. The selling price is $105. A classmate says that the markup is 175% because $105/$60=1.75. Is your classmate correct? Explain how your arrived at your answer. The words between the slashes are the choices.
(Only the selling price/The selling price minus the cost to the store/Only the cost to the store)__________ should be in the numerator and $60 should be in the denominator. So, the percent of markup is (25/50/75/100/175) ___%.

Therefore, your classmate (is/is not) ____ correct.

Answer 1

Here are the steps, and remember to pay closely attention to the wording of the question. In this case, you have to find the percentage, and not the actual price. 

First, calculate the markup in absolute terms: 

$105 - $60 = $45 

Then find the relative markup over the original price, or the markup rate: ($45) is (some percent) of ($60), or: 

45=(x)(60) 

So the relative markup over the original price is: 

45 ÷ 60 = x = 0.75 

Since x stands for a percentage, you need to remember to convert this decimal value to the corresponding percentage. 

The markup rate is 75% The selling price minus the cost to the store should be in the numerator and $60 should be in the denominator. So, the percent of markup is 75%. 

Therefore, your classmate not correct.