Miguel sells high-end computers to clients in his neighborhood.The profit margin is 20 percent,and the cost of each unit of computer is $10,000.The selling price of each unit must be:
A) $12,000.
B) $15,000.
C) $12,500.
D) $14,000.
E) $13,250.

Question

Quizplus · Accepted Answer

To find the selling price, you need to add the profit margin to the cost:
Profit Margin = 20% = 0.20
Cost = $10,000
Selling Price = Cost + (Profit Margin x Cost)
Selling price = $10,000 + (0.20 x $10,000)
Selling price = $10,000 + $2,000
Selling price = $12,000
Therefore, the best choice is C.

Miguel Sells High-End Computers to Clients in His Neighborhood