If the unit selling price is $2.50 and the unit cost is$1.00, what action is needed to maintain the grossmargin percentage when unit cost increases $0.25?Lower the selling price.Increase the selling price more than $0.25.Maintain the same selling price.Increase the selling price $0.25.

Answer:D.Increase by more than 0.25 dollars.Step-by-step explanation:What is the gross margin %?Margin % = (2.50/1.00) * 100 = 250%If the cost goes up 0.25 what will the  selling price have to do to maintain a markup of 250%?250% =(x/1.25) * 100%Divide by 100%250 / 100 = x / 1.252.5 = x / 1.25   Multiply both sides by 1.252.5 * 1.25 = x3.125 = xBut that is really not the question. The question is, how much higher is that now than it used to be?3.125 - 2.50 = 0.625 cents.So you would have to increase the selling price by more than 0.25