If an item costs $5.00, adding 50% for profit and 10% markup on total cost results in what final price?

If an item costs $5.00, adding 50% for profit and 10% markup on total cost results in what final price?

• A. $10.00
• B. $8.25
• C. $11.00
• D. $8.00

Answer: (B)

Understanding how sequential percentage changes affect price. When you add 50% for profit, you multiply the cost by 1.50: 5.00 × 1.50 = 7.50. Next, the 10% markup is on that new total, so you multiply by 1.10: 7.50 × 1.10 = 8.25. Equivalently, you can multiply the original cost by the combined factor 1.50 × 1.10 = 1.65, giving 5.00 × 1.65 = 8.25. So the final price is $8.25.

Understanding how sequential percentage changes affect price. When you add 50% for profit, you multiply the cost by 1.50: 5.00 × 1.50 = 7.50. Next, the 10% markup is on that new total, so you multiply by 1.10: 7.50 × 1.10 = 8.25. Equivalently, you can multiply the original cost by the combined factor 1.50 × 1.10 = 1.65, giving 5.00 × 1.65 = 8.25. So the final price is $8.25.