Question

A shopkeeper marks the price of an article 20% above its cost price. He offers some discount on the marked price and gains a profit of 8%. Rate of discount is 
1. 8%
2. 10%
3. 12%
4. 15%

Answer 1

Correct Answer - Option 2 : 10%

Given

Marked price  = 20% above cost price

Profit earned  = 8%

Formula Used 

Profit % = (profit/cost price) × 100

Discount% = (discount/marked price) × 100

Calculation 

Let cost price (c.p) = 100

So, marked price (m.p) = 120

Selling price (s.p) = cost price + profit

S.p = 100+8 = 108

Discount = m.p - s.p

Discount = 120 - 108= 12

Discount = (12/120) ×100 = 10%

∴ Discount is 10%