Can someone explain the concept of markup price in business?

[Kross]

I have heard about markup price in business. They said that it is one of the parameters that is used to set the price of a product. That's to keep business profitable.

What does it entail? And how it is determined? How can markup price determined by a business?

 

[Suba]

That's right, markup is a strategy/method to set a simple and easy price for a product, markup is often expressed as a percentage, for example 20% of production costs.

 

[Augusta]

Markup is the difference between a product's selling price and cost as a percentage of the cost.