Marked 40% up, 25% off — Profit & Loss Aptitude Question
Marked 40% up, 25% off: A trader marks his goods 40% above cost and allows a discount of 25%. Answer and worked solution on CodeKairo.
- Topic: Profit & Loss
- Section: Quantitative Aptitude
- Difficulty: Medium
- Time target: 60 seconds
Question
A trader marks his goods 40% above cost and allows a discount of 25%. What is his profit percent?
Options
- 5%
- 8%
- 10%
- 15%
Show the answer and the worked solution
Correct answer: A. 5%
Worked solution
- CP = 100, marked price = 140.
- SP = 75% of 140 = 105.
- Profit = 5 on a cost of 100 = 5%.
Answer: 5%.
The idea
Chain the multipliers: CP × 1.40 × 0.75 = CP × 1.05. Markup is on cost while discount is on the marked price, so the two never cancel arithmetically.
Shortcut. Net % = a − b − ab/100 = 40 − 25 − 10 = 5%. The 10 is the discount biting into the 40% mark-up itself.
Common trap. 15% — subtracting the discount from the mark-up (40 − 25), forgetting the discount is taken on the larger marked price.