Question

A retailer buys the product from a shopkeeper at a discount of $ 40\% $ on the list price(marked price) and sells them to the customer at a discount of $ 25\% $ on the list price. What is his profit percentage?

Answer 1

Hint: Assume the list price of the product and then find the cost price and selling price of the product and then use both the price to calculate the profit percentage earned by him.

Complete step-by-step answer:
A retailer buys the product from a shopkeeper at a discount of $ 40\% $ on the list price(marked price) and sells them to the customer at a discount of $ 25\% $ on the list price.
Assume that the list price of the product is equal to $ x $ .
As per given in the question that the shopkeeper purchases the item at a discount of $ 40\% $ on the list price(marked price). So, the cost price of the product for the shopkeeper is equal to
$ x - \dfrac{{40}}{{100}}x = \dfrac{{60}}{{100}}x $ .
As it is also given that the shopkeeper sells the product to the customer at a discount of $ 25\% $ on the list price. So, the selling price of the product for the shopkeeper is equal to
$ x - \dfrac{{25}}{{100}}x = \dfrac{{75}}{{100}}x $ .
So, the gain on selling the product is equal to
$ \dfrac{{75}}{{100}}x - \dfrac{{60}}{{100}}x = \dfrac{{15}}{{100}}x $ .
The formula for the profit percentage is equal to the gain divided by cost price multiplied by $ 100 $ it gives,
 $
\Rightarrow profit\% = \;\dfrac{{\dfrac{{15}}{{100}}x}}{{\dfrac{{60}}{{100}}x}} \times 100 \\
   = \dfrac{{15}}{{60}} \times 100 \\
   = \dfrac{1}{4} \times 100 \\
   = 25\% \;
  $
So, the profit percentage on the product is equal to $ 25\% $ .
So, the correct answer is “ $ 25\% $ .”.

Note: Firstly note that there is a discount offered on the marked price which makes the cost price and also discount is offered to the customer on the marked price only which makes the selling price. Use these selling and cost prices for the profit percentage.