Sachin purchases a watch from a dealer at some price and sells it at 20% profit. The next day, he purchases the same watch, and marks up the price by 75% and offers a discount of 30%. What is the change in the percentage of the profit that Sachin receives on day 2?
Show answer & explanation
Correct answer: B
Explanation
The correct answer is option 2 i.e. 2.5%.
Let CP = ₹100
Day 1:
Profit = 20%
SP = 100 + 20% of 100 = 100 + 20 = ₹120
Day 2:
Markup = 75% → Marked Price = 100 + 75% of 100 = ₹175
Discount = 30% → SP2 = 70% of 175 = ₹122.5
Profit on Day 2 = ₹122.5 − ₹100 = ₹22.5
Profit % on Day 2 = × 100 = 22.5%
Change in profit = 22.5% - 20% = 2.5%