Markup

This topic is related to business, fundamentally buying and selling. The total expense that you incur on an item before selling is the actual cost of that item. The price at which you sell the same item is your revenue. The difference of (price – cost) is the profitor the income you get out of the sale. If, for any reason, the difference is negative, then it is no more a profit but a loss.  Let us continue our discussions with only the situations of profit.

The profit definitely has a bearing on the decision of fixing your price. If the market situation is favorable you can fix the price at your discretion as long as it is more than the cost you have incurred plus the income you desire to have. But in the competitive world the situation is not so.

So you have to very prudently decide the amount to be added by which you are neither priced out nor suffer a loss. The amount such added is called as markup. So basically it is also refers to the profit but decided purely on the cost and not on the favorable market conditions. Hence, mark up is the minimal profit in business.

Now let us go to the mathematical part like markup percentage, calculating mark up or mark up calculation.  Suppose ‘x’ is the cost of purchase of an item plus the other incidental expenses you incurred. Let ‘y’ be the minimum amount that you feel the transaction is worth.

All said and done that is the amount of income for your survival which cannot be considered as a part of the actual cost. So the percentage of markup is [(y/x)*100]%. Generally a merchant uses this percentage as a key for similar items and for a brief period.

Now let us do an actual mark-up pricing example. Suppose you buy an item for $95 and incurred $5 subsequently to cover up all the incidentals and overheads. so the actual cost of the item is $100. Your experience prompts you that only with 20% mark-up on each sale you can sustain in business. So the sale you could decide is $120. But the merchant will not immediately decide on this.

If he senses that the particular item is in great demand or others are selling at higher price, he will sell only at the market price and hence in such case the actual markup is much higher than he envisaged. On the other hand, even with the minimal adding of 20% if he is priced out in the market he will decide to stop selling that particular item.

Using Elimination to Solve Linear Equations

There are different types of equations in mathematics. There can be different methods to solve these equations. One can use solve by elimination method to solve the equations. The equations can be linear and also quadratic in nature. Sometimes they are cubic in nature. This method is used to solve a set of linear equations. If the numbers of variables to be found out are ‘2’, then a set of equations must be given to find them.

A set of equations means two equations must be given. The number of equations can be deciding factor in finding the solution. In this method an unknown variable is eliminated first. Then the value of the second variable can be easily found out. Once the value of the first variable is found out then this value can be substituted in any one of the given equations and the second variable can be easily found out. This is one of the easiest techniques that can be used to find the unknowns in linear equations. For solving equations having three unknowns three equations must be given, otherwise it is not possible to find the unknowns. This is a prerequisite to find the unknowns.

The ‘solve by elimination technique is used when a set of linear equations are to be solved. This technique can be very useful and simple to use. There are various techniques available to solve linear equations. This is one of the simplest methods and can easily understood and used.

This is why it is most commonly used by the students. It is also easy to cross-check the answers. The solution obtained must satisfy the given equations. The process of solving by elimination can make the task of solving of linear equations very easy.

Once solve by the elimination method is learnt, the other methods to solve the linear equations can also be learnt. This is the basis for the other methods. So, one must thoroughly understand this method. Here elimination refers to the fact that a variable is first eliminated in this method. Once a variable is eliminated the second variable can be easily found out. Then this value helps in finding the other variable.

This can be done by using the principle of substitution. The value found out is substituted back into the equation and the value of the other variable is easily found out.