A shopkeeper offers a 10% discount on dairy products and still manages to make a 20% profit. What is the actual cost (in ₹) to the shopkeeper of a dairy product marked ₹420?
Show answer & explanation
Correct answer: D
Explanation
The correct answer is option 4 i.e. 315.
Let's break down the problem:
Selling Price (SP) after Discount:
Discount = 10% of 420 = 42
SP = Marked Price - Discount = 420 - 42 = 378
Cost Price (CP):
Given, the shopkeeper makes a 20% profit.
So, SP = CP + 20% of CP
Or, 378 = CP + (20/100) * CP
Or, 378 = (120/100) × CP
Therefore, CP = (378 × 100) / 120 = 315
So, the actual cost to the shopkeeper is ₹315.