A shopkeeper sold an item at 20% gain. Had he bought it Rs.50 cheaper and sold it at the same price, he would have gained 25%. Find the cost price of the item (in Rs.).
Show answer & explanation
Correct answer: D
Explanation
The correct answer is Option 4 i.e. 1,250.
Let original CP = x, so:
SP1 = 1.2x
New CP = x − 50x
SP2 = 1.25 (x − 50)
Selling price be same in both cases
1.2x = 1.25(x − 50)
1.2x = 1.25x − 62.5
0.05x = 62.5
x = 1250