A refrigerator manufacturer makes a profit of 15% by selling each refrigerator for ₹ 17,250. If production costs increase by 18%, what should the selling price of the refrigerator be to earn a profit of 18%?
Show answer & explanation
Correct answer: C
Explanation
The correct answer is option 3 i.e ₹20,886.
The cost price (CP) of the refrigerator (CP) = SP ÷ Profit% = 17250 ÷ 1.15 = ₹15,000
New CP = 15000 + 18% of 15000 = 15000 × 1.18 = ₹17,700
New Selling Price = 17700 × 1.18 = ₹20,886