The bookstore on your university campus uses a pricing approach where all items are marked up 50%. For a new shipment of new school hoodies, the items wholesale price is $40, so the selling price is $60. What is the contribution margin for the hoodies?
A) $20
B) $40
C) 50%
D) $100

Question

Quizplus · Accepted Answer

The contribution margin is the difference between the selling price and the wholesale price, which is $60 - $40 = $20.

The Bookstore on Your University Campus Uses a Pricing Approach