Question

When the price of shoes is decreased by 10%, the number of pairs sold increased by 20%. What is the net effect on sales?​

Answer 1

Answer:

• The net effect on sales is increment of 8%.

Given:

• When the price of shoes is decreased by 10%, the number of pairs sold increased by 20%.

To find:

• The net effect on sales.

Solution:

Let their be x pairs of Rs y.

At beginning,

Sold = Number of shoe pairs × Price of a pair

i.e. Sales = xy...(1)

According to given condition (when price is decreased by 10%)

10% of y = y/10

.i.e. New price = y - y/10 = 9y/10...(2)

According to given condition (number of pairs sold increased by 20%)

20% of x = x/5

Now,

Number pairs sold now = x + x/5 = 6x/5

Now, (new sales)

Sales = (6x/5) (9y/10) ...from (1) and (2)

=> Sales = 54xy/50 = 27xy/25

Comparing sales at beginning and new sales we get,

New sales > Old sales

Now we have to find the increase in sales

Increase in sales = 27xy/25 - xy

=> Increase in sales = 2xy/25

Now, Let 2xy/25 be n% of xy

=> n = (2xy × 100) / (25 × xy)

=> n = 2 × 4

=> n = 8%

Therefore, the net effect on sales is increment of 8%.