SUMMARY
The tea company aimed to pack 200g packets for a 30% profit margin but ended up with a 25% profit due to incorrect machine settings. The equations established are: for a 30% profit, the selling price is defined as $p = 1.3(200c)$, and for a 25% profit, it is $p = 1.25[(200+x)c]$. By dividing these equations, the relationship between the profit margins and the additional tea can be analyzed, leading to the conclusion that the extra tea per packet can be calculated by solving the equation $1 = \dfrac{1.3(200)}{1.25(200+x)}$.
PREREQUISITES
- Understanding of profit margin calculations
- Basic algebra for solving equations
- Familiarity with variables in mathematical expressions
- Knowledge of cost and pricing strategies in business
NEXT STEPS
- Learn how to derive profit margins from cost and selling price
- Study algebraic manipulation techniques for solving equations
- Explore pricing strategies in retail and their impact on profit
- Investigate the effects of production errors on profitability
USEFUL FOR
Business analysts, financial planners, and anyone involved in pricing strategies or profit margin analysis in retail environments.