Asked by Tasha Barnes on Apr 28, 2024
Verified
Is it possible for the rate of mark-up on cost to exceed 100%?
Cost
The amount of money required to purchase something or to produce a good or service.
- Conceptually distinguish between the rate of mark-up on cost versus the rate of mark-up on selling price and explain scenarios where one may exceed 100%.
Verified Answer
JP
Janice PhillipsApr 28, 2024
Final Answer :
True
Explanation :
If an item is marked up (M) by more than the unit cost (C), then
Rate of mark-up = MC\frac{M}{C}CM * 100% > 100%
Rate of mark-up = MC\frac{M}{C}CM * 100% > 100%
Learning Objectives
- Conceptually distinguish between the rate of mark-up on cost versus the rate of mark-up on selling price and explain scenarios where one may exceed 100%.