If a retailer adds a 25-cent markup to a product which costs the retailer $1.00, then according to the text the retailer's markup is 25 percent.

Question

Quizplus · Accepted Answer

The retailer's markup is 25% of the cost price ($1.00), which means the markup is $0.25. However, the markup percentage is calculated based on the cost price, making it 25/1.00 = 25%. The statement as phrased suggests a misunderstanding of how markup percentage is calculated.

If a Retailer Adds a 25-Cent Markup to a Product