Profit & Loss Question Answers

Profit, Loss, Cost Price, Selling Price - CAT 2007

Question 4 the day : August 26, 2002
The question for the day is a sample practice problem in profit, loss, discounts, an Arithmetic Topic and the problem provides an understanding of the different terms such as Cost Price, List Price, Selling price and margins.

Question
Rajiv sold an article for Rs.56 which cost him Rs.x. If he had gained x% on his outlay, what was his cost?

1. Rs.40
2. Rs.45
3. Rs.36
4. Rs.28

Correct Answer - Rs.40. Choice (1)

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Explanatory Answer

x is the cost price of the article and x% is the profit margin.

Therefore, s.p =  X* ( 1 + X  / 100)= 56 => X*((100+X) / 100) = 56

So, 100x + x² = 5600.
Solving for 'x' , we get x = 40 or x = -140.
As the price cannot be a -ve quantity, x = 40.

The cost price is 40 and the markup is 40.

It is usually easier to solve such questions by going back from the answer choices as it saves a considerable amount of time.