A shopkeeper offered following four different discount schemes for buyers on an item.
A. Two successive discounts of 8%
B. A discount of 11% followed by a discount of 5%.
C. Successive discounts of 13% and 3%
D. A discount of 16%.
If Rajiv wants to purchase the item from this shop at minimum price, he should opt for the discount scheme:
Show answer & explanation
Correct answer: A
Explanation
The correct answer is option 1 i.e. D.
A. 8% and 8% ⇒ 1 − (1 − 8/100) × (1 − 8/100) = 1 − 0.92 × 0.92 = 1 − 0.8464 = 15.36%
B. 11% and 5% ⇒ 1 − 0.89 × 0.95 = 1 − 0.8455 = 15.45%
C. 13% and 3% ⇒ 1 − 0.87 × 0.97 = 1 − 0.8439 = 15.61%
D. Single 16% ⇒ 16%
Maximum discount = 16% ⇒ Minimum price
Scheme D