A trader marks his goods 40% above the cost price and gives a discount of 25%. If he gains Rs. 75 on an item, what is the cost price of the item?
Show answer & explanation
Correct answer: D
Explanation
The correct answer is option 4 i.e. Rs. 1500.
Let CP = x
MP = 1.4x
Discount 25% ⇒ SP = 1.4x × 0.75 = 1.05x
Profit = 1.05x – x = 0.05x = 75
⇒ x = 75/0.05 = 1500