Markups in Retailing Are Typically Computed on the Basis of ________

question 27

Multiple Choice

Markups in retailing are typically computed on the basis of ________.

• A) merchandise cost
• B) merchandise cost plus freight
• C) retail selling price
• D) retail selling price plus freight

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Definitions:

Variable Costs

Expenses that change in proportion to the activity of a business.

Short Run

A time period in economics during which at least one input, such as plant size, is fixed and cannot be altered.

Profit Maximization

The procedure through which a business identifies the pricing and production volume that yields the highest earnings.

Market Price

The price at which a good or service is offered in the marketplace.