A person sold two watches for Rs 5500 each. In the sale of the first watch, he made a profit of 20% and in the sale of the second watch, he incurred a 20% loss. What is his gain or loss percentage in total?

4% loss

The correct answer is Option (2) → 4% loss

Selling price (SP) of each watch = ₹5500

First watch (20% profit):

$\text{CP}_1 = \frac{5500}{1.20} = ₹4583.33$

Second watch (20% loss):

$\text{CP}_2 = \frac{5500}{0.80} = ₹6875$

Total Cost Price:

$4583.33 + 6875 = ₹11458.33$

Total Selling Price:

$5500 + 5500 = ₹11000$

Loss:

$11458.33 - 11000 = ₹458.33$

Loss Percentage:

$\frac{458.33}{11458.33} \times 100 \approx 4\%$