A trader sold an article, after giving a discount which was 20% of the selling price, for a profit of 20% which is calculated on the selling price. If he had sold the article at the marked price, what would his profit percentage have been?
Question
A trader sold an article, after giving a discount which was 20% of the selling price, for a profit of 20% which is calculated on the selling price. If he had sold the article at the marked price, what would his profit percentage have been?
Solution
Let's break this down:
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The trader sold an article after giving a 20% discount on the selling price. This means the selling price is 80% of the marked price. Let's denote the marked price as MP and the selling price as SP. So, SP = 0.8 * MP.
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The trader made a profit of 20% on the selling price. This means the cost price (CP) of the article is 80% of the selling price. So, CP = 0.8 * SP.
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If the trader had sold the article at the marked price, his profit would have been MP - CP.
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The profit percentage is calculated as (Profit / CP) * 100.
Now, let's substitute the values:
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From step 1, we know SP = 0.8 * MP. So, MP = SP / 0.8.
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From step 2, we know CP = 0.8 * SP.
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From step 3, the profit if sold at marked price would be MP - CP = (SP / 0.8) - (0.8 * SP).
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The profit percentage would then be {[(SP / 0.8) - (0.8 * SP)] / (0.8 * SP)} * 100.
Solving this equation gives the profit percentage as 25%. So, if the trader had sold the article at the marked price, his profit percentage would have been 25%.
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