Question

A shopkeeper gives a discount of 25% on the marked price of an article and still earns a profit of 20% on his outlay, if he had not given any discount, then the profit on his outlay would have been

• A. 45%
• B. 50%
• C. 55%
• D. 60%

Answer 1

The correct option is D 60%

Let the Market Price $=$ Rs. 100, Discount $=$ 25%
Discounted Price$=Rs.100\times \frac{100-25}{100}$
$Rs.100\times \frac{75}{100}=Rs.75$
$Profit=20$%
$\therefore$ Cost Price $=Rs.75\times \frac{100}{100+20}$
$=Rs.75\times \frac{100}{120}=Rs.\frac{125}{2}$
Had he not given discount, his profit would have been
$=Rs.100-Rs.\frac{125}{2}=Rs.\frac{75}{2}$
Profit on Rs. $\frac{125}{2}=Rs.\frac{75}{2}$
$\therefore$ Profit on Rs. 100 $=\frac{75}{2}\times \frac{2}{125}\times 100=60\%$