The price of a commodity is increased by 20% and then again by 25%. By what per cent should the increased price be reduced to get back to the initial price?
Show answer & explanation
Correct answer: B
Explanation
The correct answer is option 2 i.e 33%.
Let the initial price be 100 (for simplicity).
First increase by 20% = 100 + 20% of 100 = 100 + 20 = 120
Increase 120 by 25% = 120 + 25% of 120 = 120 + 30 = 150
So, final price = 150
Initial price = 100
Now,
Decrease = 150 - 100 = 50
Percentage decrease = (50 / 150) × 100 = 33%