A dealer marked the price of an item 45% more than its cost price and sold it by allowing a discount of 20%. Find his profit percentage.
Show answer & explanation
Correct answer: D
Explanation
The correct answer is option 4 i.e. 16%.
Let's assume the cost price of the item = Rs 100
So, Marked price of the article = 100 × (100 + Marked up %)/100
= 100 × (100 + 45)/100 = 145
After 20% discount, the selling price = 100 × (100 - Discount %)/100
= 145 × (100 - 20)/100 = 116
So, profit percentage = 100 × (100 + Profit %)/100
= (116 - 100)/100 × 100 = 16%