A dealer marks an article 60% above the cost price and sells it to a customer allowing two successive discounts of 10% and 20% on the marked price. If he gains ₹1,064 in the transaction, the cost price (in ₹) of the article is :
Show answer & explanation
Correct answer: B
Explanation
The correct answer is option 2 i.e. 7000
Given that
Marked price = 60% more than the cost price
Two successive discounts of 10% and 20% on the marked price
Let the cost price be 100 units
Marked price = 1.6 × 100 = 160 units
Selling price = Marked price × (100 - discount%)/100
Selling price = 160 × (100 - 10)/100 × (100 - 20)/100 = 160 × 0.90 × 0.80 = 115.2 units
The gain = S.P. - C.P. = 115.2 - 100 = 15.2 units
15.2 units = ₹1,064
1 unit = ₹1,064/15.2 = ₹70
Hence, the cost price of the article = 70 × 100 = ₹7000