Answer
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Step 1:: Determine the total cost price of the juicer machines.
Cost~price = \frac{Total~investment}{Number~of~units} = \frac{2,200,000}{7000} = 314.29 ~dollars
The total investment in the plant is $2,200,000 dollars, and the company plans to sell 7000 juicer machines. Thus, the cost price per unit is:
Step 2:: Calculate the markup per unit.
Markup~per~unit = Selling~price - Cost~price = 500 - 314.29 = 185.71 ~dollars
So, the markup per unit is:
Step 3:: Calculate the total markup.
Total~markup = Markup~per~unit imes Number~of~units = 185.71 imes 7000 = 1,300,000 ~dollars
The company plans to sell 7000 juicer machines, so the total markup is:
Step 4:: Calculate the total cost of producing the juicer machines.
Total~cost = Cost~price imes Number~of~units = 314.29 imes 7000 = 2,200,000 ~dollars
We already know the cost price per unit, so the total cost is:
Step 5:: Calculate the markup percentage.
Markup~percentage~as~a~percentage~of~cost = \frac{185.71}{314.29} imes 100 \% \approx 59.09 \%
The markup percentage is the ratio of the total markup to the total cost, expressed as a percentage: However, the markup percentage is usually given as a percentage of the cost price, not the selling price. To calculate this, we can use the following formula: Plugging in the values, we get:
Final Answer
The markup percentage as a percentage of cost for Crimson Company is approximately $59.09 \%$, not listed among the options.
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