Multiple choice

A shopkeeper wants to earn a profit of 27% on his goods. But for marketing purpose, he has to allow a discount of 8.5% to all his customers. By what percent (approximately), above the cost price, must he mark his goods?

  1. 56.78%

  2. 62.24%

  3. 43.87%

  4. 38.80%

  5. 27.79%
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Let CP = 100. Desired SP = 127. Let MP be x. x * (1 - 0.085) = 127. x * 0.915 = 127. x = 127 / 0.915 = 138.80. Markup = 38.80%.

AI explanation

Assume the cost price of the goods is Rs 100. The target selling price to earn a 27% profit is Rs 127, which must equal the marked price minus the 8.5% discount. Using the formula Marked Price = (Selling Price * 100) / (100 - Discount), we get Marked Price = (127 * 100) / 91.5 = Rs 138.80. The required markup percentage above the cost price is therefore 38.80%.

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