Question

If a trader marks the price of an article 50 percent more than the cost price and allows a discount of 30 percent, then what is his profit percentage?
1. 5 percent
2. 8 percent
3. 2 percent
4. 10 percent

Answer 1

Correct Answer - Option 1 : 5 percent

Given:

Marked price(MP) = 1.5 × Cost price(CP)

Discount = 30%

Formula used:
Profit = SP - CP

Profit% = (Profit/CP) × 100

Discount% = (Discount/MP) × 100

Discount = MP - SP

SP = Selling price

Calculation:

MP = 1.5CP

30 = (Discount/1.5CP) × 100

⇒ Discount = 0.45CP

⇒ SP = 1.5CP - 0.45CP = 1.05CP

Profit = 1.05CP - CP = 0.05CP

Profit% = (0.05CP/CP) × 100 = 5

∴ Profit = 5%