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A trader finds that the net profit he has made, inspite of h

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Joined: 22 Sep 2011
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A trader finds that the net profit he has made, inspite of h [#permalink]

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New post 23 Sep 2011, 10:31
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I am posting one question and seems to be of good quality...

A trader finds that the net profit he has made, inspite of his spring balance reading 10% less than the actual weight, is 20%. What is the markup on the cost price?
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Location: Hyderabad, India
Schools: ISB, IIMs
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Re: profit and loss question - complex level [#permalink]

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New post 23 Sep 2011, 21:09
jrymbei wrote:
I am posting one question and seems to be of good quality...

A trader finds that the net profit he has made, inspite of his spring balance reading 10% less than the actual weight, is 20%. What is the markup on the cost price??



Lets assume the total cost of 1 unit of an item: $100
Since the spring shows 10% less: so the measured value of an item will be 0.9 instead of 1 unit. So, the trader will charge $90

And as given in the problem statement 90 = 1.2* x (where x is the cost price of unit)
x= 75

Target selling price = cost price + markup
markup= 100-75 =$25

markup % = 25/75 = 33.33%

Cheers!!!!!!!
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Re: profit and loss question - complex level [#permalink]

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New post 23 Sep 2011, 21:24
Good explanation and the answer is correct.
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Re: profit and loss question - complex level [#permalink]

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New post 23 Sep 2011, 21:36
Let the the cost price of 1 kg of item be $ 1. Now when trader sells 1 kg, he actually sells more than 1 kg . let he actually sell x kg. According to question (x - 10/100 *x)=1 so x =10/9 kg. A/q he sells 10/9 instead of 1 kg . and on this 10/9 kg he gets profit of 20%. 120% of 10/9 =1.33 $. This mark-up price pertains to translation that was made on 1kg item @ 1 $. so mark-up price = 33.33%
Re: profit and loss question - complex level   [#permalink] 23 Sep 2011, 21:36
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