Multiple choice

After allowing a discount of 25%, a trader still makes a profit of 20%. How much percent above the cost price does he mark his goods?

  1. 40%

  2. 60%

  3. 20%

  4. 30%
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Let CP = 100. Profit = 20%, so SP = 120. Discount = 25%, so SP = 0.75 * MP. 120 = 0.75 * MP, so MP = 120 / 0.75 = 160. The markup is 60% above CP.

AI explanation

Let the cost price be 100, which makes the selling price 120 after a 20 percent profit. If the marked price is M, a 25 percent discount means the selling price is 0.75M. Setting 0.75M equal to 120 gives M equals 160. Therefore, the goods are marked 60 percent above the cost price.

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