Which of the Following Is a TRUE Statement About Markups

question 91

Multiple Choice

Which of the following is a TRUE statement about markups?

• A) A firm can lose money even when using a high markup.
• B) Markup percents are computed as a percent of the cost of the product.
• C) It's easier for a producer to administer the prices consumers pay for products if the markup used varies from one intermediary to the next.
• D) The lower the markup, the lower the profit.
• E) None of the above is true.

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Definitions:

Compounded

The process where interest is calculated on the initial principal and also on the accumulated interest of previous periods of a deposit or loan.

Annually

Annually means occurring once every year or pertaining to a period of one year.

Compounded

The process of earning interest on previously earned interest, leading to an increase in the total amount over time.

Monthly

Occurring or produced once a month.