Question

A manufacturer fixes his selling price at 33% over the cost of production. If cost of production goes up by 12% and manufacturer raises his selling price by 11%, his percentage profit is
1. 32%
2. 30%
3. 31.81%
4. 31.5%

Answer 1

Correct Answer - Option 3 : 31.81%

Given:

A manufacturer fixes his selling price at 33% over the cost of production.

Formula used:

P = S.P. – C.P.

P% = (P/C.P.) × 100 

P → Profit 

S.P. → Selling price

C.P. → cost price

Calculations:

Let the cost of production of the article be Rs. 100.

So, Selling price of the product = 100 × 133/100 = 133

The new cost of production = Rs. 112

Now, new SP = 133 × (111/100) = Rs. 147.63

Profit = 147.63 – 112 = Rs. 35.63

Profit % = 35.63 × 100/112 = 31.81%

∴ The required profit% is 31.81%.