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08-22-2007, 03:34 PM
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Marketing Problem
I had this question on 4tests.com. Can anyone explain it? Thanks!
Wal-Mart's buying office just purchased leather belts for $30.00 each. They want a 20% markup at retail on the belts. What retail price should they charge? Answer = $37.50     
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08-22-2007, 03:54 PM
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I don't know what the choices were, but I would have said $36.00; was that a choice?
__________________
Brian R. Fey Sr. A.S. - Administrative Management B.S. - Criminal Justice M.S. - Psychology Go E.C. Globes!! Shoto-Advice:
"EC" "Prayer" "A Pass is a Pass" "Slow and Steady - Wins the Race" “Sometimes The Easy Way Is Not Always The Best Way” "Passing a Petersons = Conquering a CLEP -or- Defeating a DSST" "The 5 R's of Study: Repetition - Re-Enforces - Recognition - Recall - Retention" "Always be Ready to Release Your Mind & Incorporate the Advice of Others into Your Plans."
"Studying is like Boiling Water, if it is not Heated Constantly it will Once Again Become Cold Water."
Other Sources of CLEP & DSST Study Material
REA Books, Comex Books, Pass Your Class Guides, Standard Deviants DVD's, Petersons Practice Exams, Dummies Books, Idiot's Guides .
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08-22-2007, 04:01 PM
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That was not a choice, but I thought $36 sounded right, too. I wonder if they got it wrong. $36.50 was a choice, but that doesn't make sense!
Last edited by Drummerboy : 08-22-2007 at 04:15 PM.
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08-22-2007, 04:46 PM
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I could almost guarantee that its 36$. I say almost, cause i always have doubts that they could actually get it wrong, although i know it happens. ^^
__________________
.-'-..-'-..-'-..-'-..-'-..-'-..-'-..-'-..-'-..-'-..-'-..-'-..-'-..-'-..-'-..-'-. 100 CLEP Credits (All 13 CLEP Tests Taken Without IC) 25 DSST Credits (All 5 DSST Tests Taken With IC) 30 ECE Credits (All 6 ECE Tests Taken With IC) 27 Credits From University (Two Classes Total) 0 Remaining Graduated from Evergreen in 8 Months w/ 182 credits. Currently pursuing a Masters in Education at UW. .-'-..-'-..-'-..-'-..-'-..-'-..-'-..-'-..-'-..-'-..-'-..-'-..-'-..-'-..-'-..-'-.
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08-22-2007, 05:47 PM
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Here is the explanation they gave. Can anyone make heads or tails of it?
Explanation of Answer: To calculate the Retail Sales Price, you must divide $30.00(Cost) by 100% - 20%(Markup) returning $37.50. Thanks!
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08-22-2007, 11:27 PM
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hopefully i can explain this well...think of it this way:
if wal-mart was to have a 20%-off sale on the belts, what price would they have to set on the belts so that they don't lose money (in this case, wal-mart won't sell the belts for less than $30 since they bought it at that price). try to calculate it backwards. so if you make an algebraic equation, it would be: (assume "x" is the price you need to charge) x - 0.20x = 30 if you calculate it, it would turn out to be... 0.80x = 30 x = 37.50 is that clear? if not, i'll try re-explaining it. good luck! =]
__________________
Jenny =]
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08-23-2007, 10:15 AM
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I think I get it. They want it to have a markup that is 20% of the retail price instead of 20% of cost. We don't know the retail so we have to figure it backwards. We have to deduct 20% from retail: x(retail price) - .20x = 30.00. In other words, "the retail price minus 20% = $30". Okay, that makes sense.
An easier way to figure it out on multiple choice would be to take 20% away from the answer choices and see which one becomes $30. Thanks Blue!
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