Question

On decreasing the price of a colour TV by $30\%$ its sale is increased by $20\%$ The effect on the revenue is

• A. $16\%$ decrease
• B. $16\%$ increase
• C. $20\%$ increase
• D. $20\%$ decrease

Answer 1

Answer: (A)

$16\%$ decrease

Let the price of $1$ color TV $=$ Rs. $x$ and the number of TV sold $=$ Rs. $y$.

$\therefore$ the total original sell price $=xy$.

Now the price after $30\%$ reduction $=$ $x-\frac{30x}{100}=\frac{7x}{10}.$

The number of sold TV after it was increased by $20\%$

$=$ $y+\frac{20y}{100}=\frac{6y}{5}.$

$\therefore$ the total of the new sell price $=$ $\frac{7x}{10}\times \frac{6y}{5}=\frac{21xy}{25}<xy.$

$\therefore$ It is a loss.

$\therefore$ Loss $=$ $xy-\frac{21xy}{25}=\frac{4xy}{25}$

So, the p.c of loss $=$ $\frac{\frac{4xy}{25}}{xy}\times 100=16$ p.c.

Ans- Option A.