Multiple choice

Passage

Directions : Read the following passage and answer the question. A company manufactures two types of engines - 'CEM' and 'LVM'. Engine 'CEM' is made of three components a, b and c and engine 'LVM' is made of two components p and q. The three components (a, b and c) of engine 'CEM' are imported from the US, Japan and Russia, respectively. All the three components of engine 'CEM' respectively account for 2X%, X% and (4X + 5)% of the total production cost of engine 'CEM'. Two components (p and q) of engine 'LVM' are imported from China and Brazil, respectively. Components 'p' and 'q' respectively account for Y% and (Y + 10)% of the total production cost of engine 'LVM'. The total cost of all the three components (a, b and c) of engine 'CEM' is Rs. 32,000 and the total cost of two components (p and q) of engine 'LVM' is Rs. 27,000. The total cost of production of engine 'CEM' and engine 'LVM' is Rs. 80,000 and Rs. 90,000, respectively.

If the company wants to earn 25% profit on engine 'CEM' but a discount of 20% is to be offered to customers for promotional reasons, then what will be the marked price of the engine?

  1. Rs. 1,75,000

  2. Rs. 2,25,000

  3. Rs. 1,15,000

  4. Rs. 1,25,000

  5. Rs. 1,35,000
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

The cost of engine CEM is 80,000. To earn 25% profit, the selling price must be 80,000 * 1.25 = 100,000. If a 20% discount is offered on the marked price (MP), then 0.8 * MP = 100,000. MP = 100,000 / 0.8 = 125,000.

AI explanation

To find the marked price, we first calculate the required selling price to achieve a 25 percent profit on the production cost of 80000 rupees, making the selling price 100000 rupees. Using the formula Marked Price equals Selling Price divided by (1 minus Discount Percentage), we calculate 100000 divided by 0.80. This gives a marked price of 125000 rupees.

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