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    Question

    A shopkeeper sells an item for ₹1,500 at a profit of

    20%. If he wants to earn a profit of 25%, what should be the selling price of the item?
    A ₹1,525 Correct Answer Incorrect Answer
    B ₹1,562.5 Correct Answer Incorrect Answer
    C ₹1,600 Correct Answer Incorrect Answer
    D ₹1,627.5 Correct Answer Incorrect Answer

    Solution

    Let the cost price of the item be ₹x. Selling price at 20% profit = ₹1,500, so x + 0.2x = ₹1,500. 1.2x = ₹1,500, so x = ₹1,500 / 1.2 = ₹1,250. Now, if the shopkeeper wants a profit of 25%, the selling price should be Selling price = ₹1,250 + 0.25 × ₹1,250 = ₹1,250 + ₹312.5 = ₹1,562.5. Correct option: b

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