Knowing the answer to these questions is important for any student of Marketing Situation A – The ‘Manufacturer’s Suggested Retail Price’ for a…

Knowing the answer to these questions is important for any student of Marketing

Situation A 

– The ‘Manufacturer’s Suggested Retail Price’ for a Lennox Air Conditioning unit is $2500.

– The ‘Jobber’ or ‘Trade’ discount is 20%.

So how much does a local installation company pay for one unit?

Situation B

– When the installation company installs the A/C unit in someone’s house, how much Profit will they make on just the A/C unit if they sell it for the MSRP?

– Now, here is the real question, what percent Markup is that? 

(He will also charge for the ‘installation labor’ that has profit too but let’s not deal with that right now.)