A shopkeeper earned a profit (in ₹) by selling an item, which is three times the discount offered (in ₹). If the discount offered is 6.25%, what is his profit percentage?
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → 25%
The discount is taken on the marked price, while the profit per cent is taken on the cost price. So the marked price is chosen first and the cost price is worked back from it.
Assuming the marked price to be ₹100:
Discount \(=6.25\%\) of 100 \(=\) ₹6.25, so selling price \(=100-6.25=\) ₹93.75
Profit \(=3\times6.25=\) ₹18.75 (three times the discount)
Cost price \(=93.75-18.75=\) ₹75
Profit per cent \(\displaystyle =\frac{18.75}{75}\times100=25\%\)