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1. At a wholesale auction, a used car dealer wants to bid on a mint-condition 1972 Cadillac Eldorado convertible. She thinks that the car could be resold for $36,000 in her showroom. She typically likes to have margins of about 20%. Given that auction buyers also pay a 15% buyer's premium (based on the winning bid price), what is the maximum amount that she should hid?

1. At a wholesale auction, a used car dealer wants to bid on a mint-condition 1972 Cadillac Eldorado convertible. She thinks that the car could be resold for $36,000 in her showroom. She typically likes to have margins of about 20%. Given that auction buyers also pay a 15% buyer's premium (based on the winning bid price), what is the maximum amount that she should hid?

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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4. At a wholesale auction, a used car dealer wants to bid on a mint-condition 1972 Cadillac Eldorado convertible. She thinks that the car could be resold for $36,000 in her showroom. She typically likes to have margins of about 20%. Given that auction buyers also pay a 15% buyer's premium (based on the winning bid price), what is the maximum amount that she should bid?
Transcribed Image Text:4. At a wholesale auction, a used car dealer wants to bid on a mint-condition 1972 Cadillac Eldorado convertible. She thinks that the car could be resold for $36,000 in her showroom. She typically likes to have margins of about 20%. Given that auction buyers also pay a 15% buyer's premium (based on the winning bid price), what is the maximum amount that she should bid?
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