GMAT Quantitative Review

3.0 Math Review

3.4 Word Problems

6. Profit

Gross profit is equal to revenues minus expenses, or selling price minus cost.

Example: A certain appliance costs a merchant $30. At what price should the merchant sell the appliance in order to make a gross profit of 50 percent of the cost of the appliance?

Solution: If s is the selling price of the appliance, then image, or image. The merchant should sell the appliance for $45.