If the cost price of 20 articles is equal to the selling price of 25 articles, what is the % profit ...
If the cost price of 20 articles is equal to the selling price of 25 articles, what is the % profit or % loss made by the merchant?
Answer/Solution
20% loss
Steps/Work
Explanatory Answer
Approach: Assume a value for cost price. Compute cost price and selling price for the same number of articles
Let the cost price of 1 article be $1.
Therefore, cost price of 20 articles = 20 * 1 = $20
The selling price of 25 articles = cost price of 20 articles = $20.
Let us find the cost price of 25 articles.
Cost price of 25 articles = 25 * 1 = $25.
Therefore, profit made on sale of 25 articles = Selling price of 25 articles - cost price of 25 articles
= 20 - 25 = -$5.
Because the profit is in the negative, the merchant has made a loss of $5.
Therefore, % loss = Loss/Cost Price∗100
% loss = 5/25∗100 = 20% loss.
Choice C
Approach: Assume a value for cost price. Compute cost price and selling price for the same number of articles
Let the cost price of 1 article be $1.
Therefore, cost price of 20 articles = 20 * 1 = $20
The selling price of 25 articles = cost price of 20 articles = $20.
Let us find the cost price of 25 articles.
Cost price of 25 articles = 25 * 1 = $25.
Therefore, profit made on sale of 25 articles = Selling price of 25 articles - cost price of 25 articles
= 20 - 25 = -$5.
Because the profit is in the negative, the merchant has made a loss of $5.
Therefore, % loss = Loss/Cost Price∗100
% loss = 5/25∗100 = 20% loss.
Choice C