Numerical answer
A shopkeeper marks his goods 40% above the cost price and then allows two successive discounts of 10% and 5% on the marked price. What is his profit percentage? (Enter the answer correct to one decimal place.)
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Answer: 19.7
Let cost price = 100. Marked price = 140.
After 10% discount: 140 × 0.9 = 126.
After a further 5% discount: 126 × 0.95 = 119.7.
Profit = 119.7 − 100 = 19.7 on a cost of 100, i.e. 19.7%.
Tip: multiply the factors directly: 1.4 × 0.9 × 0.95 = 1.197. Successive discounts of 10% and 5% are NOT the same as a single 15% discount; they equal 14.5%.
After 10% discount: 140 × 0.9 = 126.
After a further 5% discount: 126 × 0.95 = 119.7.
Profit = 119.7 − 100 = 19.7 on a cost of 100, i.e. 19.7%.
Tip: multiply the factors directly: 1.4 × 0.9 × 0.95 = 1.197. Successive discounts of 10% and 5% are NOT the same as a single 15% discount; they equal 14.5%.
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