A retailer buys a particular product for $4. To make a profit, the retailer adds $2 to cover operating expenses and provide a profit. The percentage markup on the $6 selling price is
A) 50 percent.
B) 33.33 percent.
C) 100 percent.
D) 20 percent.
E) 25 percent.

Question

Quizplus · Accepted Answer

The retailer sells the product for $6, which is a markup of $2 from the cost of $4. Therefore, the percentage markup can be calculated as follows: 
Markup = $2 
Markup percentage = (Markup/Cost) x 100% 
Markup percentage = (2/4) x 100% 
Markup percentage = 50% 
However, the question asks for the percentage markup on the selling price of $6, not on the cost of $4. Therefore, we need to calculate the markup percentage as a percentage of the selling price: 
Markup = $2 
Selling price = $6 
Markup percentage = (Markup/Selling price) x 100% 
Markup percentage = (2/6) x 100% 
Markup percentage = 33.33% 
Therefore, the answer is B, 33.33 percent.

A Retailer Buys a Particular Product for $4