A manufacturer adds 11.1% margin when shipping articles to wholesaler,

Question

A manufacturer adds 11.1% margin when shipping articles to wholesaler, who in turn adds 16.67% when shipping to retailer. The retailer’s margin is 37.5% but due to Diwali; he gives a discount of 10% on the listed price. The effective distributorship margin from manufacturing to end customer, is closest to

(A) 40%
(B) 55%
(C) 60%
(D) 64%
(E) 72%

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(A) 40%
(B) 55%
(C) 60%
(D) 64%
(E) 72%

Are You Up For the Challenge: 700 Level Questions

Archit3110 · Answer

CP of mfg ; 100
SP of mfg ; 111
SP of WS ; 111*1.1667;~ 130
SP of Retailer ; 130* 1.375 ; 178
Discount price ; 178 * .9 ; 160
 % of margin from mfg to end customer ; 160-100/ 100 ; 60 %
option C

Parthkulkarni · Answer

Are we given calculator during PS section? This calculation is insane to do manually. Appreciate any inputs.

Bunuel · Answer

No, a calculator is not allowed in the PS section of the test.

Vibhatu · Answer

After the manufacturer:
1×1.111=1.111
After the wholesaler:
1.111×1.1667≈1.296
After the retailer's margin:
1.296×1.375≈1.782
After the 10% discount:
1.782×0.9≈1.604
The final price is 1.604 units.

Therefore 60%
Answer: C

JohnEi · Answer

Works easier if you use fractions instead...

1 + 0.111 = 10/9
1 + 0.1667 = 7/6

0.125 = 1/8
Therefore: 0.375 = 3/8
Therefore: 1 + 0.375 = 11/8
0.9 = 9/10

Calculation: 10/9 * 7/6 * 11/8 * 9/10

You can cancel out most of the fractions, leaving you with 7/6 * 11/8 which is 77/48. This is the only calculation left, the result is about 1.6.

Kinshook · Answer

A manufacturer adds 11.1% margin when shipping articles to wholesaler, who in turn adds 16.67% when shipping to retailer. The retailer’s margin is 37.5% but due to Diwali; he gives a discount of 10% on the listed price.

The effective distributorship margin from manufacturing to end customer, is closest to

Effective price increase from manufacturing to end customer = 1.111*1.1667*1.375*.9 = 1.6

The effective distributorship margin from manufacturing to end customer, is closest to = 60%

IMO C

A manufacturer adds 11.1% margin when shipping articles to wholesaler,

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A manufacturer adds 11.1% margin when shipping articles to wholesaler,

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