4. (2 pts each) a. You recently opened a pizza restaurant. It costs you $5 for e

Question

4. (2 pts each) a. You recently opened a pizza restaurant. It costs you $5 for everything you need to make one pizza. If you want to sell pizzas with a 30% markup on cost, what should you charge for each pizza? $35 b. If you decide to sell these pizzas at $7, what is your percentage markup on cost? 4% c. This week will be the busiest pizza selling week of the year. You decide to preorder enough ingredients to make 200 pizzas for the week, expecting about 15% of these ingredients will go bad during the

Explanation / Answer

1) You recently opened a pizza restaurant. It costs you $5 for everything you need to make one pizza. If you want to sell pizzas with a 30% markup cost, what should you charge for each pizza
Solution: $6.5
Working:
Product cost: $5; markup cost: 30%; Selling price: ?
Selling price = (100% + Markup) * Product Cost
= (100% + 30%) * 5
=$6.5

2) If you decide to sell pizza at $7, what is your percentage markup cost?
Solution: 40%
Working:
Markup = $7 - $5 / $5 * 100% = 40%

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