Answer:
(a) $878.24
(b) $848.30
(c) Amy would pay less for the golf clubs if she gets them directly from the distributor
Step-by-step explanation:
Part (a)
The wholesale price is $499. When the pro shop gets them from the distributor, it has to pay a mark-up of 10%. 10% expressed as decimal is 10/100 = 0.10
10% of 499 = 0.10 x 499 = 49.90
So total cost including markup for the pro shop is 499 + 49.90 = $548.90
We can compute this directly without computing mark-up cost using the formula
Cost = 499(1+0.10) = 499 x 1.1 = 548.90
The pro shop puts a mark up of 60% which in decimal is 60/100 = 0.6 on the above cost
So the price Amy pays = 548.90(1+0.6) = 548.90 (1.6) = $874.28
Part (b)
Wholesale price = $499
If Amy purchases directly from distributor there is a 70% markup on the wholesale price. 70% = 70/100 = 0.7
So the price Amy would have to pay = 499(1+0.7) = 499 x 1.7 = $848.30
Part (c)
Since the cost of purchasing directly from distributor is less than the cost of purchasing from pro shop the answer is
Amy would pay less for the golf clubs if she gets them directly from the distributor
