mrunal [aptitude] concepts of marked price and successive discounts (profit-loss) without (stupid)...

[Aptitude] Concepts of Marked Price and Successive Discounts (Profit-Loss)without (stupid) formulas

Profit, Loss, Discount, Marked Price = all of them are mere extension of Percentagecalculation concept. And they can be solved effortlessly, without mugging up anyformulas.

What is Discount?1.What is successive discount?2.Case: Successive vs One Time Discount?3.What is marked price?4.Case: Finding Marked Price from Profit %5.Case: Finding marked price from Selling price6.Case: Finding % Profit / loss in MP-Discount7.MOCK TEST8.Answers with explanations and shortcuts9.

What is Discount?

In the garment stores, youve come across this sign many times: HURRY! 20%OFF!!That 20% is called discount.Suppose a Music CD has price tag of Rs.100 and the shopkeeper is offering 20%discount.That means 20% less on the price tag.The price youve to pay=Rs.100 minus 20% of 100=100-(20100/100)=100-20=Rs. 80 youve to pay, to buy that music CD.But in exam, we dont have no time to do such lengthy calculations.So just think in your head:20 percent discount means youve to pay 100 percent minus 20 percent=80 percent ofthe price tag.% means one upon hundred (1/100)So 80% means (80/100=0.8)So youve to pay 0.8 times the original price.=0.8 x 100=Rs. 80

What is successive discount?

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It means discount on the discount. (just like Compound Interest rate= interest oninterest)The original price of a music CD is Rs.100. A shopkeeper offers 10% discount on thismusic CD and then again offers 20% discount on the new price. How much will youhave to pay, finally?Concept: Successive Discounts

Phase I: 10% discount

So new price = 0.9 x original price. (by the way, how did we get 0.9 ? well 10%discount means youve to pay 90%. And 90% means 0.9)

Phase II: 20% discount

=0.8 x new price=0.8 x 0.9 x original price.It means, after successive discount of 10% and 20%, the final price youve to pay=0.72 x original price.=0.72 x 100=Rs.72If it was successive discount of 20% and then 10%? Still answer will remain same.ORDER or sequence doesnt matter.Lets test our skill with an actual question from SSC/FCI Exam taken in Nov 2012.Q1. A dealer buys a table listed at Rs.1,500 and gets successive discounts of 20% and10%. He spends Rs.20 on transportation and sells it at a profit of 20%. The selling priceof the table is

Rs.1,320A.Rs.1,350B.Rs.1,360C.Rs.1,380D.

Think in your head:20% discount =0.8 x original price (this is our new price)10% successive discount= 0.9 x New price=0.9 x 0.8 x original priceFinally dealer had to pay: 0.72 x original price.Then he invested Rs.20 on transport, so his total investment (cost price) is(0.72 x original price) + Rs.20And ultimately he sold It @20% profit.20% profit means 100%+20%=120%=1.2 times the investment (cost price).=1.2 times [(0.72 x original price) + Rs.20]In the examhall,only write following line and do the math, dont waste time writingeverything or multiplying numbers @every stage.=1.2 times [(0.72 x 1500) + Rs.20]=1.2 [1080+20]=1.2 [1100]


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=Rs. 1320(I hope you know quick multiplication with 11, basically 1211= in 12 youdo:1|(1+2)|2=132)

Case: Successive vs One Time Discount?

Q. Jethalal, has a mobile phone with price tag Rs.12,399/-. He is offering two schemesto you

Buy it at one time discount of 30%a.Buy it at two successive discounts of 15% and 15%b.

Which of the above scheme is more beneficial to you (customer)?

Long cut (tiresome and boring calculation)

Scheme A Sheme B

Discount offered=30% of 12,399=0.3 x 12,399=3719.7

Phase I15% of 12399=1859.85 Rs. (discount I)So new price : 12399 MINUS 1859.85=10539.15Phase II: (second discount)=15% of 10539.15=0.15 x 10539.15=1580.8725 (discount II)Total discount=1859.85 +1580.8725=3440.7225

We are getting more discount in Scheme A compared to Scheme B.So, from customers point of view, Scheme A is more beneficial.^Very lengthy and tiresome calculation isnt it?Well, if you look at it carefully, the price tag Rs.12,399/- is irrelevant here.

Shortcut (almost none calculation)

Scheme A Scheme B

Discount offered=30%Final price youve to pay=0.7 times original price.

Successive discount 15% (two times)Final price youve to pay=0.85 x 0.85 x original price=0.7225 x original price

In Scheme A, youve to pay less price compared to Scheme B. Because 0.7 < 0.7225So, from customers point of view, Scheme A is more beneficial.Sidenote: you can do 8585 with Vedic shortcut (square of numbers ending with five)Square of 85=8|5=(8x(8+1)|25=8*9|25


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=7225I hope discount and successive discount is clear. Moving to the next topic.

What is marked price?

Before that, answer this question:

Why do shopkeepers give discount?

Well its a marketing propaganda to seduce customers.Im running a jeans store. I bought a pair of jean for Rs.100 (cost price).Now I put a new tag on it Rs.500 (marked price) and then put a huge poster outside myshop: 50% OFF on any item!From buyers point of view it looks very attractive wow 50% discount!!But in reality, Im making huge profit. Because 50% discount on Rs.500= Youve topay Rs.250, while I had invested only Rs.100! so my profit=(250-100)=Rs.150Marked price=this new price tag Rs.500. Discount is given on marked price. If we wantto visualize it, here is the diagram:Concept Marked Price, DiscountMind it: Profit or loss is always calculated on actualinvestment (Cost price), unless they specifically instruct you do something else.Time to test the skill with actual questions

Case: Finding Marked Price from Profit %

Q. Jethalal bought a Nokia mobile phone @ Rs. 800. He sold it to Master Bhide afterallowing a discount of 10%. In this deal, Jethalal made a profit of 12.5%. What was themarked price?

Rs. 1,000A.Rs. 1,100B.Rs. 1,200C.Rs. 1,300D.

Profit is always calculated on actual investment (cost price).Cost Price: Rs.800The question says, profit =12.5%. What is the profit in rupee terms?

Long cut Shortcut=12.5% x 800=(125/10)x (1/100) x 800=Rs. 100

12.5% =1/8 (percentage to fraction conversion table).So, 12.5% x800= (1/8) x 800= Rs. 100

Anyways in either method, profit is Rs.100Fact (i)Jethalal gave 10% discount on marked price. So customer Bhide Master had to pay only90% of the Marked Price.=0.9 times the marked price=this is the money Jethalal received from customer.


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Jethalals actual profit

=the money he received from customer MINUS his original investment.=0.9 times Marked price MINUS Rs.800But recall fact (i), Jethalals profit is Rs.100Therefore100=0.9 times Marked price Rs.800100+800=0.9 times marked price900=0.9 x MPMP=900 x 10/9MP=Rs. 1000.Final Answer: marked price is Rs.1000

In the exam hall, directly frame the equation: 0.125 x800 =(0.9 xMP)-800Lets try another one.

Case: Finding marked price from Selling price

Q. Master Bhide, bought two pens for Rs.37.40 at a discount of 15%. What must be themarked price of each of pen?

Rs.11A.Rs.44B.Rs.33C.Rs.22D.

Discount of 15%, means Master Bhide (customer) paid (100-15)=85% of the markedprice.=0.85 times the marked priceBut question also says he paid Rs.37.40, Therefore37.40=0.85 x MP.MP=3740/85=(374x 10)/ (175)=(374 x 2)/17=(222)=44. (Sidenote, if you dont know the multiplication table of 17, then use approximationmethod explained in earlier article. CLICK ME)Most important part: Rs.44 is the marked price of two pens. So marked price of eachpen =44/2=Rs.22Answer is (D)In the actual exam, rough paper calculation: =37.4/(0.85 x 2)

Case: Finding % Profit / loss in MP-Discount

Jethalal marks the price tags of all his mobile phones, 10% above the cost price. Andthen He offers 10% discount on their marked prices. What is his profit or loss?

1% profitA.


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1% lossB.5% profitC.No profit No loss.D.

Assume his total investment is Rs.100 (=cost price). Well we can assume totalinvestment as CP or x or y or anything but assuming Rs.100 saves the time ofcalculating percentages later on.Marked price=10% above cost priceSo price tag (marked price) is100%+10% of Cost price=110% of cost price=1.1 x cost price=1.1 x 100=Rs. 110Now he offers 10% discount on marked price, so customer has to pay only0.9 times the marked price=0.9 x 110=Rs.99Verdict: His investment is Rs.100 and he receives only Rs.99 from customers so he ismaking lossHow much loss?

Longcut

Loss % formula =(100-99)/100 x 100=1%

ShortcutWe assumed Rs.100 initially for the very reason that to prevent long cutformula!Since he receives one rupee less (100-99), his loss is 1%.

In the actual exam, rough paper:

Invested Received100 0.9 x 1.1 x 100=99

So, loss is 1%.I hope the concept of marked price is clear by now. So it is time for a

MOCK TEST

Time: 20 MinutesCorrect =1mWrong= minus 0.33m1. When Jethalal offers discount on cost price, he makes

ProfitA.LossB.No Profit no LossC.Profit or loss, depending on situation.D.


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2. Jethalals offering to sell an LCD TV priced @Rs.1,79,299/- under two offers

One time discount of 40%A.Successive Discount of 36% and 4%B.

Which offer is more beneficial from customers point of view?3. Jethalal offered a scheme: two successive discounts 10% and then 10%. Which ofthe following scheme will give same effect?

One time discount of 15%A.One time discount of 19%B.One time discount of 20%C.One time discount of 25%D.

4. Which of the following, is a better deal from customers point of view?

Three successive discounts of 10,20,30%A.Two successive discounts of 20,20%B.One time discount of 50%C.

5. Jethalal offers two deals

Successive discounts: first 10% and then 20%1.Successive discounts: first 20% and then 10%.2.

Which of the following are true?

Customer will save more money in Deal 1A.Customer will save more money in Deal 1B.Customer will save same amount of money in both deals.C.

6. Jethalal fixes the sale price of his mobiles @15% above the cost price. He sells all hismobiles @12% less than the fixed price. What is his profit percentage?

2.5%A.1.2%B.1.5%C.2%D.

7. Jethalal sells his mobiles on 10% discount on marked price. He bought a [email protected] and wants to get 10% profit. What should be the marked price?

1275A.1250B.1175C.1100D.

8. Jethalal wants to give 10% discount on all his mobile phones. But at the same time,he also wants to make 20% profit. At what percent above the cost price, should he


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mark the price of his phones?

25%A.30%B.33.33%C.37.5%D.

9. Consider these statementsI. Marked Price is always higher than Cost priceII. Marked price is never lower than Selling price.Which of above statements are correct?

Only 1a.Only 2b.Both 1 and 2c.Noned.

10. How can one become Master of aptitude?

By searching for a competitive exam, that doesnt have aptitude questions.A.By thinking like a loser, My maths is not good and it can never be improved. Illjust hope to clear some exam with luck by chance.

B.

By watching India-England Cricket test series because those cricketers will givemoney to start some business, should you fail in the CSAT/IBPS/SSC/CMAT/CAT or some other stupid exam.

C.

By uploading motivational/funny photos on Facebook and tagging random friendsin it.

D.

By practicing maximum questions at home.E.

Answers and Explanations

Q. Ans. Explanation

1 BDiscount on cost price=hell receive less money than his originalinvestment=always loss.

2 A 0.6

Profit % is 101.2 MINUS 100=1.2%

7 DProfit of 10% on 900=0.9 x Marked price MINUS 9000.1*900=0.9*M-900M=1100

8 C

Assume cost price=Rs.100Profit of 20% on 100=0.9 x Marked price MINUS 1000.2*100=0.9*m-100M=133.33So marked price is 133.33-100=33.33% above the cost price.

9 C Both statements are correct.10 ?? Lolz

For the complete Archive of all aptitude articles, Visit Mrunal.org/aptitude

URL to article: http://mrunal.org/2012/11/aptitude-concepts-of-marked-price-and-successive-discounts-profit-loss-without-stupid-formulas.html

Posted By Mrunal On 20/11/2012 @ 15:20 In the category Aptitude


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mrunal [aptitude] concepts of marked price and successive discounts (profit-loss) without (stupid)...

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