Question
An item is sold for a profit of 20%. If the cost to
purchase the item had been reduced by 20%, and it was subsequently sold at a 25% loss, the seller would have made Rs. 300 less than originally. What was the initial cost price of the item?Solution
Let the original cost price of the article be Rs. ‘x’ Therefore, original selling price of article = Rs. 1.2x New cost price of the article = Rs. 0.8x New selling price of the article = 0.75 × 0.8x = Rs. 0.6x Therefore, 1.2x – 0.6x = 300 Or, x = 300/0.6 = 500
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