Answer:
The profit margin also known as net profit ratio is 84%
Explanation:
profit margin is also known as net profit ratio is a measured by finding the net profit as a ratio to the revenue. this is used to measure how profitable a business is.
profit margin = net profit / revenue (equation 1 )
net profit = revenue - cost ( equation 2 )
revenue = $206000
cost = $20000 + $13000 = $33000
from equation 2
net profit = $206000 - $33000 = $173000
substitute the net profit and revenue values into equation 1
profit margin = $173000 / $206000 = 0.84 * 100 (since it is ratio of the revenue)
hence is profit margin is 84%
