GMAT Question of the Day - Daily to your Mailbox; hard ones only

It is currently 17 Jun 2019, 08:48

Close

GMAT Club Daily Prep

Thank you for using the timer - this advanced tool can estimate your performance and suggest more practice questions. We have subscribed you to Daily Prep Questions via email.

Customized
for You

we will pick new questions that match your level based on your Timer History

Track
Your Progress

every week, we’ll send you an estimated GMAT score based on your performance

Practice
Pays

we will pick new questions that match your level based on your Timer History

Not interested in getting valuable practice questions and articles delivered to your email? No problem, unsubscribe here.

Close

Request Expert Reply

Confirm Cancel

If a merchant makes a profit of 20% based on the selling price of an

  new topic post reply Question banks Downloads My Bookmarks Reviews Important topics  
Author Message
TAGS:

Hide Tags

 
Math Expert
User avatar
V
Joined: 02 Sep 2009
Posts: 55629
If a merchant makes a profit of 20% based on the selling price of an  [#permalink]

Show Tags

New post 27 Feb 2018, 23:49
00:00
A
B
C
D
E

Difficulty:

  65% (hard)

Question Stats:

46% (01:36) correct 54% (01:27) wrong based on 70 sessions

HideShow timer Statistics

Senior PS Moderator
User avatar
V
Joined: 26 Feb 2016
Posts: 3380
Location: India
GPA: 3.12
Re: If a merchant makes a profit of 20% based on the selling price of an  [#permalink]

Show Tags

New post 28 Feb 2018, 00:24
Bunuel wrote:
If a merchant makes a profit of 20% based on the selling price of an article, what percent does the merchant make on the cost?

(A) 20

(B) 40

(C) 25

(D) 80

(E) None of these


The profit is 20% of the selling price when an article sold at 100 was bought for 80.
Here, the profit of 20 is 20% of 100, the selling price of the article!

Therefore, the profit on the cost will be \(\frac{20}{80}*100 = 25%\) (Option C)
_________________
You've got what it takes, but it will take everything you've got
e-GMAT Representative
User avatar
D
Joined: 04 Jan 2015
Posts: 2888
Re: If a merchant makes a profit of 20% based on the selling price of an  [#permalink]

Show Tags

New post 28 Feb 2018, 11:54

Solution




    • Percentage Profit based on selling price \(= 20\) %

      o \(\frac{(SP – CP)}{SP} = \frac{20}{100}\)

      o \((1- \frac{CP}{SP}) = \frac{1}{5}\)

      o \(\frac{CP}{SP} = 1-\frac{1}{5} = \frac{4}{5}\)

      o Thus, \(\frac{SP}{CP} = \frac{5}{4}\)

    • We need to find the profit with respect to the cost price

      o Percentage profit \(= (\frac{SP}{CP} – 1) * 100 = (\frac{5}{4} – 1) * 100 = 25\)%

Correct Answer: Option C
_________________
Senior Manager
Senior Manager
User avatar
P
Joined: 07 Jul 2012
Posts: 373
Location: India
Concentration: Finance, Accounting
GPA: 3.5
Premium Member
Re: If a merchant makes a profit of 20% based on the selling price of an  [#permalink]

Show Tags

New post 28 Feb 2018, 20:03
Let Selling Price= 100

Profit (20% on SP)= 20

Cost Price= 100-20= 80

% profit on cost= \(\frac{20}{80}\)*100= 25

Answer: C.
_________________
Kindly hit kudos if my post helps!
Target Test Prep Representative
User avatar
D
Status: Founder & CEO
Affiliations: Target Test Prep
Joined: 14 Oct 2015
Posts: 6522
Location: United States (CA)
Re: If a merchant makes a profit of 20% based on the selling price of an  [#permalink]

Show Tags

New post 01 Mar 2018, 18:34
Bunuel wrote:
If a merchant makes a profit of 20% based on the selling price of an article, what percent does the merchant make on the cost?

(A) 20

(B) 40

(C) 25

(D) 80

(E) None of these


We can let R = selling price and C = cost and create the equation:

R - C = 0.2R

0.8R = C

In terms of R, we see that the profit is 0.2R and the cost is 0.8R. Thus the profit as percent of cost is:

0.2R/0.8R = 0.2/0.8 = 2/8 = 1/4 = 25%

Alternate Solution:

Let’s assume the selling price is $100 and let c = the cost of the item. We know that selling price - cost = profit, or:

100 - c = 100 x 0.2

100 - c = 20

80 = c

Since the cost of the item is $80 and the profit made on its sale is $20, we see that the profit as a percent of cost is 20/80 = 1/4 = 25%.

Answer: C
_________________

Scott Woodbury-Stewart

Founder and CEO

Scott@TargetTestPrep.com
TTP - Target Test Prep Logo
122 Reviews

5-star rated online GMAT quant
self study course

See why Target Test Prep is the top rated GMAT quant course on GMAT Club. Read Our Reviews

If you find one of my posts helpful, please take a moment to click on the "Kudos" button.

Non-Human User
User avatar
Joined: 09 Sep 2013
Posts: 11377
Re: If a merchant estimates his profits at 20% of the selling  [#permalink]

Show Tags

New post 28 Jan 2019, 04:43
Hello from the GMAT Club BumpBot!

Thanks to another GMAT Club member, I have just discovered this valuable topic, yet it had no discussion for over a year. I am now bumping it up - doing my job. I think you may find it valuable (esp those replies with Kudos).

Want to see all other topics I dig out? Follow me (click follow button on profile). You will receive a summary of all topics I bump in your profile area as well as via email.
_________________
GMAT Club Bot
Re: If a merchant estimates his profits at 20% of the selling   [#permalink] 28 Jan 2019, 04:43
Display posts from previous: Sort by

If a merchant makes a profit of 20% based on the selling price of an

  new topic post reply Question banks Downloads My Bookmarks Reviews Important topics  


Powered by phpBB © phpBB Group | Emoji artwork provided by EmojiOne