Multiple choice

A merchant marks his wares 40% more than the real price and allows 20% discount. His profit is

  1. 20%

  2. 18%

  3. 16%

  4. 12%

  5. None of these
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Let the cost price be 100. Marked price = 140. Discount = 20% of 140 = 28. Selling price = 140 - 28 = 112. Profit = 112 - 100 = 12%.

AI explanation

Let the real price or cost price be Rs 100. The merchant marks the ware 40% higher, making the marked price Rs 140. He then allows a 20% discount on this marked price, calculating the selling price as 140 - (140 * 0.20) = Rs 112. The profit percentage is found using the formula ((Selling Price - Cost Price) / Cost Price) * 100, resulting in ((112 - 100) / 100) * 100 = 12%.

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