A dealer sells an article by allowing a 15% discount on its marked price and gains 12%. If the cost price of the article is increased by 10%, how much discount percentage should he allow now on the same marked price so as to earn the same percentage of profit as before?
Show answer & explanation
Correct answer: B
Explanation
The correct answer is Option 1 i.e. 6.5%.
Let original CP = 100 and Original SP = 112
MP = 112 × (100/85) = 2240/17
New CP = 110
New SP = 110 × (112/100) = 616/5
Discount = 2240/17 - 616/5 = 728/85
Discount percentage = (728/85)/(2240/17) × 100 = 6.5%