b. What markdown percent should he have used?- Dishonest Dave’s Discount Den is planning on advertising that “everything in the store is being marked down by 15%!”.
In reality, though, Dave plans to fi rst increase his prices so that after the 15% markdown the prices are actually the
same as they were all along. What percent will he fi rst mark up his prices? - A retailer uses a 75% markup when setting the price of a piece of costume jewelry. The retail price is $20.86. What is
the cost? - A pushcart snack vendor buys 12-ounce sodas for 25 cents each, and sells them for $1. What is the percent markup?
- An amusement park had 74,006 visitors in the summer of 2005. In 2006, the number of visitors increased by 8.4%. In
2007, though, the number fell by 7.9%. How many visitors were there in 2007? - A furniture store marks up its “list” prices by 62.5% over cost, but then marks the list prices down by 20%. What is the
markup percent that it is actually using? - An Internet service provider normally charges $59.95 per month for its service. It is offering a promotion where, for the
fi rst year, you can subscribe for $39.95 per month. What percent discount does this represent? - Vladimir makes $23,075 per year. He got a 6% raise. What is his new salary?
- Last year, Howard’s tree service business had gross sales totaling $67,525. This year, sales totaled $82,388. What was
the percent increase in the business’s sales? - A cable company offers high-speed Internet service for $49.95 per month, its most popular cable package for $64.99
a month, and unlimited local and long-distance phone service for $39.49 per month. The company offers a discount
package as well; customers who order all three services pay $112.50 per month. What percent of a markdown does
this represent?
F. Additional Exercises
- Automobiles are usually listed for sale at a price suggested by the manufacturer (the manufacturer’s suggested retail
price (MSRP)), also called the sticker price. The invoice price is the cost of the vehicle listed on the invoice (i.e., the
bill) sent to the manufacturer. While most people think of the invoice price as the dealer’s cost, in reality most car
manufacturers lower the price to the dealer by a holdback, a further discount below the invoice price.
Suppose that a new car has a $29,995 list price, and a $26,792 invoice price. The holdback is 3% of the invoice
price.
a. Calculate the dealer’s actual cost for this car.
b. Suppose that a car dealer offers to sell this car for “1% over invoice.” Calculate the amount of markup over invoice
and the price at which the dealer is offering the car for sale.342 Chapter 8 Mathematics of Pricing