Question

In the following exercises, find (a) the amount of the mark-up and (b) the list price.

Tom paid $0.60 a pound for tomatoes to sell at his produce store. He added a 33% mark-up. What price did he charge his customers for the tomatoes?`

Short answer

Part (a) The mark-up amount is $0.198.

Part (b) The list price is $0.798.

Step-by-step solution

Part (a) Step 1. Given information.

The original price is $0.60 and the mark-up rate is 33%.

Part (a) Step 2. Find the amount of mark-up.

Calculate the mark-up amount:

$$\begin{gathered} Mark-upamount=33\%oforiginal\cos t \\ =33\%of0.60 \\ =0.33\times 0.6 \\ =0.198 \end{gathered}$$

So, the mark-up amount is $0.198.

Part (b) Step 1. Find the list price.

Calculate the list price by adding a mark-up amount to the original cost.

$$\begin{gathered} \mathrm{List}\mathrm{price}=\mathrm{original}\mathrm{cost}+\mathrm{mark}-\mathrm{up}\mathrm{amount} \\ =0.60+0.198 \\ =0.798 \end{gathered}$$

So, the list price is $0.798.