Multiple choice

Mr. A has opened a shop to sell milk. The fixed cost (such as rent, etc) is Rs. 8000 per month. He purchases pure milk at Rs. 15 per litre, adds water to that milk and sells it for Rs. 20 per litre. In a month, if he sells exactly 1000 litres of milk and gets Rs. 3000 profit (after removing fixed cost), what is the ratio of milk to water in the milk that he has sold?

  1. 1 : 2

  2. 2 : 3

  3. 3 : 2

  4. 2 : 1
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Total revenue = 1000 * 20 = 20000. Total profit = 3000. Total cost = 20000 - 3000 = 17000. Fixed cost = 8000, so variable cost = 9000. Let x be liters of pure milk; then (1000-x) is water. 15x = 9000 implies x = 600 liters of milk. Water = 400 liters. Ratio milk:water = 600:400 = 3:2.

AI explanation

His total revenue is 1000 litres times Rs. 20, which equals Rs. 20000, and his total cost including fixed costs and a Rs. 3000 profit is Rs. 23000. The cost of pure milk is Rs. 15 per litre, and if M is the amount of pure milk, the total cost of milk is 15M; this gives the equation 20000 minus 8000 minus 15M equals 3000, so M is 600 litres. The ratio of milk to the 400 litres of added water is 600 to 400, which simplifies to 3:2. The result is 3:2.

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