ska7945 wrote:A toy store�s gross profit on a computer game was 10 percent of the cost of the game. If the store increased the selling price of the game from $44 to $46 and the cost of the game remained the same, then the store�s gross profit on the game after the price increase was what percent of the cost of the game?
A. 10.5%
B. 11%
C. 12.5%
D. 13%
E. 15%
We are given that a toy store's gross profit on a computer game was 10 percent of the cost of the game. Since we know that revenue - cost = profit and we are given that profit = 0.1 x cost, we can create the following equation, in which r = revenue and c = cost:
r - c = 0.1c
r = 1.1c
Since the original selling price (or revenue) was $44, we can substitute 44 for r in the equation r = 1.1c and determine c.
44 = 1.1c
440 = 11c
40 = c
If the price was increased to $46, the new profit would be 46 - 40 = $6.
Finally we can determine what percent the profit was of the cost.
(profit/cost) x 100%
(6/40) x 100%
(3/20) x 100%
15%
Answer:
E
