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24 May 2017, 04:36
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jy295
As far as I know, profit margin is universally calculated as a percent of revenue.
This question gives you profit as a percentage, not profit margin.
Profit in percentage terms will be on Cost.
11 Jan 2018, 16:29
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Hi All,
This question can be approached in a couple of different ways, depending on how you 'see' the math involved.
We're told that milk is purchased for Rs 6.40/liter, mixed with some water, then the mixture is resold at Rs 8/liter. We're told that this process leads to a 37.5% profit.
37.5% = 3/8, so we're looking for total revenue that is Rs 6.40 + (3/8)(Rs 6.40)....
1/8 of Rs 6.40 = Rs 0.80, so....
3/8 of Rs 6.40 = Rs 2.40
Thus, that one liter of milk (and whatever water is mixed in) has to generate Rs 6.40 + Rs 2.40 = Rs 8.80 of revenue.
Comparing Rs 8 and Rs 8.80, you'll notice that the second number is exactly 10% greater than the first number. Thus, the amount of water that we need to add must be 10% of the volume of milk. A ratio of water:milk of 1:10 is needed.
Final Answer:
GMAT assassins aren't born, they're made,
Rich
This question can be approached in a couple of different ways, depending on how you 'see' the math involved.
We're told that milk is purchased for Rs 6.40/liter, mixed with some water, then the mixture is resold at Rs 8/liter. We're told that this process leads to a 37.5% profit.
37.5% = 3/8, so we're looking for total revenue that is Rs 6.40 + (3/8)(Rs 6.40)....
1/8 of Rs 6.40 = Rs 0.80, so....
3/8 of Rs 6.40 = Rs 2.40
Thus, that one liter of milk (and whatever water is mixed in) has to generate Rs 6.40 + Rs 2.40 = Rs 8.80 of revenue.
Comparing Rs 8 and Rs 8.80, you'll notice that the second number is exactly 10% greater than the first number. Thus, the amount of water that we need to add must be 10% of the volume of milk. A ratio of water:milk of 1:10 is needed.
Final Answer:
GMAT assassins aren't born, they're made,
Rich
03 Sep 2018, 07:36
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lets assume he buys 1 ltr of milk at 6.4 rs.
(8.0/6.4) profit % if he was selling 1 ltr of pure milk.
x be the amount of water added to 1 ltr of milk.
(1+x)(8.0/6.4) = 1.375
==> x = 0.1
for 1 ltr 0.1 of water ==>1:10
(8.0/6.4) profit % if he was selling 1 ltr of pure milk.
x be the amount of water added to 1 ltr of milk.
(1+x)(8.0/6.4) = 1.375
==> x = 0.1
for 1 ltr 0.1 of water ==>1:10
