A shopkeeper marks his goods 30% higher than the cost price and allows a discount of 10% on the marked price. In order to earn 6.5% more profit, what discount percent should he allow on the marked price.
Show answer & explanation
Correct answer: D
Explanation
The correct answer is option 4 i.e. 5
Let the cost price of the article be 100x
Marked price = 100x × 1.3
⇒ 130x
Now applying a discount of 10%
⇒ 130x × 0.9 = 117x
To get 6.5% more profit
Selling price: 117x + 6.5x
⇒ 123.5x
Discount% = (130x - 123.5x)/130x × 100
⇒ 5%