Question
Download Solution PDFA retailer buys 20 pens for Rs. 40 and sells it at the rate Rs. 40 for 15 pens. What is the profit margin?
Answer (Detailed Solution Below)
Detailed Solution
Download Solution PDFCalculation:
A retailer buys 20 pens for Rs. 40.
So, the cost price of 1 pen = 40/20 = Rs. 2
A retailer sells the pens at the rate of Rs. 40 for 15 pens.
So, the selling price of 1 pen = 40/15 = Rs. 8/3
Profit percent = [(Selling Price - Cost Price)/Cost Price] × 100
Profit percent = [(8/3 - 2)/2] × 100
Profit percent = (2/6) × 100
Profit percent = 100/3 = 33%
So, the profit margin is 33%.
Hence, option 3 is correct.
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