A market stallholder buys 40 kg of apples at £1.20 per kg, shown in the table. Bought 40 kg at £1.20/kg Sold at marked price 32 kg Sold at a discount 8 kg, ...
Question 1 Report
A market stallholder buys 40 kg of apples at £1.20 per kg, shown in the table.
| Bought | 40 kg at £1.20/kg |
|---|---|
| Sold at marked price | 32 kg |
| Sold at a discount | 8 kg, 25% off |
- Work out the total cost of the apples. (1)
- The stallholder marks up the cost price by 60% to set the price per kg. Work out this marked price. (2)
- Using the table, work out the total revenue for the day. (3)
- Work out the profit as a percentage of the cost price. (1)
- The target was a profit margin of at least 50%. State, with a reason, whether this was met. (1)
Answer Details
This question works through a full profit calculation for a market trader: total cost, a percentage mark-up, mixed full-price and discounted revenue, and a final profit-margin check against a target.
- \[40 \times £1.20 = £48\]
The total cost is \(£48\) [1 mark].
Marking up the cost price by \(60\%\):
\[£1.20 \times 1.60 = £1.92 \text{ per kg}\][2 marks]
The discounted price is \(£1.92 \times 0.75 = £1.44\) per kg. Total revenue combines both parts of the sale:
\[32 \times £1.92 + 8 \times £1.44 = £61.44 + £11.52 = £72.96\][3 marks]
Profit is \(£72.96 - £48 = £24.96\). As a percentage of the cost price:
\[\dfrac{24.96}{48} \times 100 = 52\%\][1 mark]
Since \(52\% \gt 50\%\), the target profit margin of at least \(50\%\) was met [1 mark].
Profit margin here is calculated on the cost price throughout (\(£48\)), not on the revenue, which is why part (d) divides by \(48\) rather than by \(72.96\).
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