Profit, Loss, Margins - XAT 2020 Sample Question

The question 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

A trader professes to sell his goods at a loss of 8% but weights 900 grams in place of a kg weight. Find his real loss or gain per cent.

1. 2% loss
2. 2.22% gain
3. 2% gain
4. None of these

Correct Answer - 2.22% gain. Choice (2)

Explanatory Answer

The trader professes to sell his goods at a loss of 8%.
Therefore, Selling Price = (100 - 8)% of Cost Price
or SP = 0.92CP

But, when he uses weights that measure only 900 grams while he claims to measure 1 kg.
Hence, CP of 900gms = 0.90 * Original CP

So, he is selling goods worth 0.90CP at 0.92CP
Therefore, he makes a profit of 0.02 CP on his cost of 0.9 CP

Profit % =
i.e., or 2.22%

Correct answer choice (2)

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