Answer:
$3.125
Step-by-step explanation:
Selling Price = $2.50
Unit Cost = $1.00
Gross margin = (Unit cost/Selling price)*100
= (1/2.5)*100
Gross margin = 40%
Unit cost increased by 0.25.
New unit cost = $1.00 1+ $0.25 = $1.25
Selling price =( Unit cost/Gross margin)*100
Selling price =[ (1.25)/40]*100
= 125/40
Selling price = $3.125
Increases the unit selling price to $3.125
Hope this will helpful.
Thank you.
The price is 3.13
In order to find this you must first calculate out the current gross margin percentage. You can find this using the equation below.
Gross Margin = cost /price
Gross Margin = 1/2.5
As
40% = Gross Margin
Now we need to use the same equation with a new cost to find price.
Cost / Price = Gross Margin
1.25 / Price = 40%
1.25/.40 = Price
3.13 = Price
