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A retailer makes a 10% profit on $1000 televisions and a 25% profit on $200 microwaves. What is the combined percent profit on a purchase of 1 TV and 1 microwave?
Correct Answer: A
Divide the total profit by total purchase price.
  1. Profit = (Sale Price)(Profit Margin)
  2. Calculate the profit on the TV:
    (0.10)($1000) = $100 profit.
  3. Calculate the profit on the microwave:
    (0.25)($200) = $50 profit.
  4. Combined percent profit = (Total dollar profit) / (Total dollar revenue)
  5. Divide the total profit by the total purchase price:
    ($100 + $50) / ($1000 + $200)
    = ($150) / ($1200)
    = 15 / 120
    = 3 / 24
    = 1 / 8
    = 0.125 = 12.5%
  6. Answer choice A is correct.

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