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# A Wholeseller supplies few chips to a retailer every year.

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PS Forum Moderator
Joined: 18 Jan 2020
Posts: 1501
Location: India
GPA: 4
A Wholeseller supplies few chips to a retailer every year.  [#permalink]

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10 Jun 2020, 07:39
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Difficulty:

35% (medium)

Question Stats:

75% (03:08) correct 25% (02:44) wrong based on 8 sessions

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A Wholeseller supplies few chips to a retailer every year. Each Chip Costs 10,000 to the wholeseller. 5% of the chips are defective and they are to be replaced without charging anything extra. if the wholeseller still makes a profit of 20%, at what price he is selling it to the retailer.

A. 12,300
B. 12,600
C. 12,900
D. 13,200
E. 13,500
Intern
Joined: 23 Oct 2019
Posts: 5
Re: A Wholeseller supplies few chips to a retailer every year.  [#permalink]

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10 Jun 2020, 08:29
1

If one chip costs 10,000 but 5% are defective, then this will add 5% to the wholesaler's costs.

This means the chips will cost, on average, 10,500 for each one that gets sold.

If the wholesaler makes 20% profit on this, then the profit is 2,100 per chip.

This means the chips are sold for 10,500 + 2,100 = 12,600 - this is (B).
Re: A Wholeseller supplies few chips to a retailer every year.   [#permalink] 10 Jun 2020, 08:29