Question

Aman started a factory with an initial investment of Rs 100000. In the first year, he incurred a loss of 5%. However, during the second year, he earned a profit of 10% which in the third year rose to 12%. Calculate his net profit for the entire period of three years.

Answer 1

$$\begin{gathered} \mathrm{Aman}\text{'}\mathrm{s}\mathrm{profit}\mathrm{for}\mathrm{three}\mathrm{years}=\mathrm{P}\left(1-\frac{{\mathrm{R}}_1}{100}\right)\left(1+\frac{{\mathrm{R}}_2}{100}\right)\left(1+\frac{{\mathrm{R}}_3}{100}\right) \\ =100,000\left(1-\frac{5}{100}\right)\left(1+\frac{10}{100}\right)\left(1+\frac{12}{100}\right) \\ =100,000\left(0.95\right)\left(1.10\right)\left(1.12\right) \\ =117,040 \\ \therefore \mathrm{Net}\mathrm{profit}=\mathrm{Rs}117,040-\mathrm{Rs}100,000 \\ =\mathrm{Rs}17,040 \end{gathered}$$