Multiple choice

The manufacturer A of a certain item sells it to a wholesaler at a profit of $20\%$ on his manufacturing cost. The wholesaler sells it to a retailer at a profit of $25\%$ and the retailer sells it to a consumer at a profit of $20\%$. The price paid by the consumer over and above manufacturing cost Will be

  1. $65\%$
  2. $80\%$
  3. $85\%$
  4. $90\%$
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Let the manufacturing cost be 100. After 20% profit, wholesaler pays 120. Wholesaler sells at 25% profit: 120 * 1.25 = 150. Retailer sells at 20% profit: 150 * 1.20 = 180. The increase over 100 is 80%.

AI explanation

Assume the manufacturing cost is 100, so the manufacturer sells the item to the wholesaler for 120. The wholesaler sells it to the retailer at a profit of 25 percent on 120, resulting in a price of 150. The retailer then sells it to the consumer at a profit of 20 percent on 150, making the final consumer price 180. Comparing this to the original manufacturing cost, the consumer pays 80 percent above it.

Keep practicing — related questions