After giving a discount of 20% on the marked price of an article, it is sold for Rs 120. Had the discount not been given, then the profit would have been 20%. What is the cost price of the article?
Show answer & explanation
Correct answer: D
Explanation
The correct answer is Option 4 i.e. Rs. 125
After giving a discount of 20% on the marked price of an article, it is sold for Rs. 120.
Had the discount not been given, the profit would have been 20%.
Selling price = Marked Price - Marked Price × Discount%
Selling Price = Cost Price + Cost Price × Gain%
Let the marked price of the article be x.
According to the question -
x - x × 20% = 120
x - 0.2x = 120
0.8x = 120
x = 120/0.8
x = 150
Let the cost price be y.
According to the question -
y + y × 20% = 150
y + 0.2y = 150
1.2y = 150
y = 150/1.2
y = 125