A furniture store sells a dining table for ₹Z, making a 25% profit. During a festive season, they increase the marked price of the same table to ₹1.6Z. They then offer a special discount of 20% on this increased marked price. What will be the percentage profit made by the store during the festive season?
- (a)26%
- (b)56%
- (c)62%
- (d)60%
Answer
Why
Correct — D.
Cost price from the first sale (₹Z is 125% of cost):
CP = Z ÷ 1.25 = 0.8Z
Festive selling price (20% off ₹1.6Z):
SP = 1.6Z × 0.8 = 1.28Z
Profit = 1.28Z − 0.8Z = 0.48Z
Profit % = 0.48Z ÷ 0.8Z × 100 = 60% → option (d)
Why the others are wrong
- (a)26% — 26% would put the festive price at 0.8Z × 1.26 ≈ 1.01Z, almost the old ₹Z. After the 20% discount the table actually sells for 1.28Z.
- (b)56% — 56% needs a festive price of 0.8Z × 1.56 = 1.248Z. The discounted price is 1.28Z, and 1.28Z ÷ 0.8Z = 1.6, a 60% gain.
- (c)62% — 62% overshoots: it needs 0.8Z × 1.62 = 1.296Z, but 20% off ₹1.6Z leaves 1.28Z, exactly 1.6 times the cost.
Concept
Unless a question says otherwise, profit percent is measured on the cost price, and the cost does not change between the two sales.
So the first sale's job is to fix the cost: selling at ₹Z for a 25% profit means Z = 1.25 × CP, so CP = 0.8Z.
The festive sale is then a chain of multipliers: 1.6Z × 0.8 = 1.28Z, and 1.28Z ÷ 0.8Z = 1.6, a 60% profit.
Two figures in the stem are prices, not costs. ₹Z is the old selling price and ₹1.6Z the new marked price, so neither can stand in for the cost of 0.8Z.
Key facts
- Selling at a g% profit means SP = CP × (1 + g⁄100), so CP = SP ÷ (1 + g⁄100).
- A discount of d% leaves SP = MP × (1 − d⁄100).
- Here CP = 0.8Z and the festive SP = 1.28Z, a ratio of 1.6.
Study next
Common traps
- Treating ₹Z as the cost: (1.28Z − Z) ÷ Z = 28%, which is not among the options.
- Taking 25% off ₹Z to get the cost: the 25% profit is on cost, so CP = Z ÷ 1.25 = 0.8Z, not 0.75Z.
15 Sep 2025, 12:30, Quant Q.9 runs the same frame with a loss: a shirt sold for ₹A at a 5% loss is marked up to ₹1.2A and sold at 10% off, so 1.08A against a cost of A ÷ 0.95 gives a 2.6% profit, which its key marks.
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