PAR.4.9

Front

What is markup in pricing?

Back

Markup is the amount added to the cost price of goods to cover overhead and profit. It is usually expressed as a percentage of the cost price.

Front

How do you calculate the selling price after a markup?

Back

Selling Price = Cost Price + (Markup Percentage × Cost Price). For example, if a bag of candy costs $1.50 and has a 60% markup, the selling price is $1.50 + (0.60 × $1.50) = $2.40.

Front

What is a proportion?

Back

A proportion is an equation that states that two ratios are equal. For example, if a/b = c/d, then a, b, c, and d are in proportion.

Front

How do you solve a proportion?

Back

To solve a proportion, cross-multiply the terms and set the products equal to each other. For example, if a/b = c/d, then ad = bc.

Front

What does a discount mean?

Back

A discount is a reduction in the price of a product or service, usually expressed as a percentage of the original price.

Front

How do you calculate the amount saved with a discount?

Back

Amount Saved = Original Price × Discount Percentage. For example, if an item costs $22.00 and has a 25% discount, the savings are $22.00 × 0.25 = $5.50.

Front

What is simple interest?

Back

Simple interest is calculated on the principal amount only, not on the interest accrued over time. It is calculated using the formula: Interest = Principal × Rate × Time.

Front

How do you calculate simple interest?

Back

To calculate simple interest, use the formula: Interest = Principal × Rate × Time. For example, if you borrow $4,000 at a 6% interest rate for 5 years, the interest is $4,000 × 0.06 × 5 = $1,200.

Front

What is the formula for calculating interest earned over time?

Back

Interest Earned = Principal × Interest Rate × Time. This formula helps determine how much interest will be earned on an investment or loan.

Front

What is the principal in finance?

Back

The principal is the original sum of money borrowed or invested, excluding any interest or profits.