Example 5.3E

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This question asks us to find one unknown, in this case the selling price. It is usual to put the unknown on the left side of the equation, which is what we did in class. The example in the book puts the equation the other way round....actually the meaning is the same. But I will stick with putting the unknown on the left.

Recall this important equation:

S = C + M

we know that C = 72, and we also know that M is 40% of C, or we can write M = 0.4 * C

now rewrite the important equation, substituting what we know:

S = 72 + 0.4 * C

now we know that 0.4 * C = 0.4 * 72 = 28.8

so S = 72 + 28.8 = 100.8

The second part of the example gives the markup of 40% based on selling price

Back to the important equation

S = C + M

now M = 0.4 * S

rewrite

S = C + 0.4 * S

subtract 0.4 S from both sides to give

0.6 S = C

we know C = 72 (given in the question)

so

0.6 S = 72

we can find S by dividing both sides by 0.6

S = 72/0.6 = 120