If the retail price of a table is Rs. 900 and the gain percentages of the manufacturer, the wholesale dealer and the retailer are 8%, 10% and 20%, respectively. Then what is the cost of production of the table (rounded off to the integer value)?
Show answer & explanation
Correct answer: B
Explanation
The correct answer is option 2 i.e. Rs. 631
Given:
If the retail price of a table is Rs. 900
The gain percentages of the manufacturer, the wholesale dealer and the retailer are 8%, 10% and 20%
Formula used:
Selling price = Cost price + Cost price × profit% ---- (1)
Calculations:
Let the cost of production of the table be x
Using equation (1), we get
Manufacturer price = x × 1.08 = 1.08x
Wholesaler price = 1.08x × 1.1 = 1.188x
Retailer price = 1.188x × 1.2 = 1.4256x
According to the question;
⇒ 1.4256x = 900
⇒ x = 631.313 or 631