Correct Answer - Option 2 : 4% loss
Given:
Percent markup = 20%
Percent discount = 20%
Formula used:
percent markup = markup / C.P × 100
Marked price = C.P + markup
S.P = markup – discount
Percent discount = discount / M.P × 100
Calculation:
Let, cost price of goods = X
Marked price = X + 20% of X = X + X / 5 = 6X / 5 = 1.2X
Now, discount% = 20%
Selling price = 1.2X – 20% of 1.2X = 1.2X – 1 / 5 × 1.2X = 1.2X – 0.24X = 0.96X
⇒ S.P = 0.96X and C.P = X
Loss = X – 0.96X = 0.04X
Percent loss = 0.04X / X × 100 = 4%
∴ The loss percent is 4%.