Jay King, owner of a local Bed and Bath store, knows that his customers will pay at most $299 for an air mattress. Assuming Jay wants a 40% markup on the selling price, the most he could pay the manufacturer for the air mattress is:
A)$197.04
B)$179.04
C)$104.65
D)$179.40
E)None of these

Question

Quizplus · Accepted Answer

Let the manufacturer's price be x.
Jay wants a 40% markup on the selling price, so he will sell at 140% of the manufacturer's price:
Selling price = 1.4x

Jay knows that his customers will pay at most $299, so:
1.4x ≤ $299
x ≤ $299/1.4
x ≤ $213.57

Therefore, the most Jay could pay the manufacturer is $213.57. However, he wants to pay slightly less in order to achieve the desired markup. To do this, we need to work backwards from the selling price:
Selling price = 1.4x
$299 = 1.4x
x = $299/1.4
x ≈ $213.57

Now we can calculate Jay's cost:
Cost = 0.6 x Selling price
Cost = 0.6 x ($299)
Cost = $179.40

Therefore, the most Jay could pay the manufacturer for the air mattress is $179.40. The answer is D.

Jay King, Owner of a Local Bed and Bath Store