Question

By selling an article at 80% of its marked price, a merchant makes a loss of 12%. what will be the percentage profit/loss made by the merchant if he sells the article at 95% of its marked price?

A) 4.5% loss
B) 4.5% profit
C) 5.5% loss
D) 5.5% profit

please answer in full explanation

Answer 1

let the marked orice be S and the cost price of article be $100. when the article is sold at 80% of its marked price, it is sold at 0.8S. selling the article at 0.8S results in a loss of 12% of the cost . therefore, the loss incurred when selling at 80% of the marked price, the article is sold at 100 -12=$88 i.e. 0.8S=$88. if the merchant sells at 95% of the marked price , he will sell the article at 95% of $110 =$104.5 .the profit made =104.5 -100= $4.5 . %profit =profit /cost price =4.5/100 = 4.5 %profit . therefore answer is 4.5