Multiple choice

An article is sold at a profit of 32%. If the cost price is increased by 20% and the sale price remains the same, then the profit percentage becomes

  1. 10%

  2. 12%

  3. 15%

  4. 20%
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A Correct answer
Explanation

Let CP = 100, SP = 132. New CP = 120. New profit = 132 - 120 = 12. Profit % = (12/120) * 100 = 10%.

AI explanation

Let the original cost price be 100, so at a 32% profit, the selling price is 132. If the cost price increases by 20%, the new cost price becomes 120. Using the new profit percentage formula, (Selling Price - New Cost Price) / New Cost Price * 100, we get (132 - 120) / 120 * 100. This simplifies to 12 / 120 * 100, resulting in 10%. The new profit percentage becomes 10%.

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