Topic

Markup & Markdown

Instructions

Read Ch. 9 of Business Math.

Consider the following as you read:

How to evaluate markups based on cost and selling price.
How to evaluate markdowns.
How to evaluate the unit selling price of perishable goods.

Answer preview

Markup refers to a value-added to the cost price of a product or service to arrive at the selling price. The markup profit will therefore be the difference between the selling price of the product/service and the cost of the good/service. The markup is important since it serves as the basis for arriving at the profit of the business. It is also important to note that the markup profit is the lifeline of the business to pay the recurring expenses of the business and earn a relevant return on investment made.

Word Count: 250