A tradesman marks his goods 10% above his cost price. If he allows his customers 10% discount on the marked price. How much profit or loss does he make, if any ?
Correct answer: B. 1% loss
- A. 1% gain
- B. 1% loss
- C. 5% gain
- D. No gain no loss
Explanation
Let the cost price be Rs. 100. The marked price is Rs. 110, and after a 10% discount the selling price is Rs. 110 x 90% = Rs. 99, giving a loss of Rs. 1 on Rs. 100, or 1% loss. The likely mistaken answer is 1% gain, caused by comparing the 10% markup and 10% discount as if they were applied to the same price.
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About Profit and Loss
Profit and loss compare the cost price and selling price of an item, using profit or loss percentages based on the cost price unless stated otherwise. Questions include marked price, discount, successive discounts, commission, and finding an unknown price, with care needed to distinguish discount from loss.
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