Multiple choice

A clothing store owner marks up the prices of his garments by 25% above the cost price. He sells 50% of the garments at a 20% discount on the marked price, and the remaining at a 30% discount on the marked price. What is the overall profit/loss percentage for the clothing store owner?

  1. Loss of 6.25%

  2. Loss of 5.25%

  3. Profit of 6.25%

  4. Profit of 5.25%
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A Correct answer
Explanation

Let cost price = 100, marked price = 125. Half sold at 20% discount (125 * 0.8 = 100), half sold at 30% discount (125 * 0.7 = 87.5). Total revenue = 100 + 87.5 = 187.5 for 2 units. Total cost = 200. Loss = 200 - 187.5 = 12.5. Loss percentage = (12.5 / 200) * 100 = 6.25%.

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