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CAT 2024 Slot 2 · Quant · Percentages · easy

The price of an item is increased by 25%. By what percentage must the new price be reduced to bring it back to the original price?

Single correct option

The price of an item is increased by 25%. By what percentage must the new price be reduced to bring it back to the original price?
  1. A. 18%
  2. B. 20%
  3. C. 22%
  4. D. 25%
Show answer and solution

Answer: (B) 20%

Let original price = 100. After a 25% increase, new price = 125. To return to 100, required reduction = 25/125 × 100 = 20%. Shortcut: for an increase of R%, the reduction needed is [R/(100+R)]×100 = 25/125×100 = 20%.
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Original question written in the CAT 2024 Slot 2 pattern and checked twice for the correct answer. Not an official question paper. How we write and check questions · Corrections policy · Report a mistake