Question

A shopkeeper marked his goods 40% higher than their cost price and allows 20% discount on every item. Find his net profit percentage.

• A. 20%
• B. 15%
• C. 12%
• D. 10%

Answer 1

The Correct Option is C

To determine the net profit percentage, first calculate the marked price (MP) of the goods. Suppose the cost price (CP) is $100. Since the marked price is 40% higher than the cost price, we can calculate it as:

MP = CP + 40% of CP = 100 + (40/100) * 100 = 100 + 40 = 140

The shopkeeper offers a 20% discount on the marked price. Therefore, the selling price (SP) can be calculated as:

SP = MP - 20% of MP = 140 - (20/100) * 140 = 140 - 28 = 112

Now, calculate the profit by finding the difference between the selling price and the cost price:

Profit = SP - CP = 112 - 100 = 12

The net profit percentage is given by the formula:

Profit Percentage = (Profit / CP) * 100 = (12 / 100) * 100 = 12%

Thus, the shopkeeper makes a net profit percentage of 12%.