Multiple choice

A trader marks his goods at $25\%$ above his cost price and allows a discount of $\displaystyle12 \frac{1}{2}$ $\%$ on purchases for cash payment. The profit percent he makes is:

  1. $\displaystyle9 \frac{3}{8}$ $\%$
  2. $\displaystyle11 \frac{2}{3}$ $\%$
  3. $\displaystyle7 \frac{1}{3}$ $\%$
  4. $\displaystyle4 \frac{1}{11}$ $\%$
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A Correct answer
Explanation

Let CP = 100. MP = 125. Discount = 12.5% of 125 = 15.625. SP = 125 - 15.625 = 109.375. Profit = 9.375%, which is 9 3/8%.

AI explanation

Assume the cost price is Rs 100, making the marked price Rs 125 after the 25% markup. The cash discount of 12 1/2% equals 1/8, so the discount amount is 125 / 8 = Rs 15.625. The selling price becomes 125 - 15.625 = Rs 109.375, yielding a final profit percentage of 9 3/8%.

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