Profit, Loss & Discount

The most practical chapter. Master the 'Ratio Method' for Profit%, the 'MP-CP Relation' for Discounts, and the 'Dishonest Dealer' concepts.

Expert Answer & Key Takeaways

The most practical chapter. Master the 'Ratio Method' for Profit%, the 'MP-CP Relation' for Discounts, and the 'Dishonest Dealer' concepts.

1. The Golden Ratio (CP:SP)

Avoid formulas like SP=CP(100+P)/100SP = CP(100+P)/100. Use Ratios.
  • 20% Profit: 1/5 → CP=5, SP=6.
  • 20% Loss: 1/5 → CP=5, SP=4.
  • Profit on SP: If 20% on SP, 1/5 → SP=5, Profit=1 &implies; CP=4. Actual P% = 14 = 25%.

Example:

Q: Profit is 25% of Selling Price. Find actual Profit %.
Solution: 25%=<spanclass=vfrac><spanclass=num>1</span><spanclass=den>4</span></span>(P/SP)25\% = <span class='v-frac'><span class='num'>1</span><span class='den'>4</span></span> (P/SP). SP=4, P=1 → CP=3.
Actual % = 13 = 33.33%.

2. The MP-CP Relationship (Master Formula)

Direct relation between CP, MP, Profit%, and Discount%.
  • Formula: CPMP = 100 - D%100 + P%.
  • Use this when Discount and Profit are given to find MP or CP directly.

Example:

Q: Discount 10%, Profit 20%. If CP=900, find MP.
Solution: CPMP = 90120 = 34.
39003 \to 900. MP=41200MP = 4 \to 1200.

3. Dishonest Shopkeeper (Weight Cheating)

Profit comes from using less weight.
  • Formula: True WeightFalse Weight = 100+P%100±x%.
  • Logic: If he uses 900g for 1kg, he sells 900g but charges for 1000g. Profit = 100g on 900g CP.

Example:

Q: Uses 800g instead of 1kg. Sells at CP. Find Profit %.
Solution: Error = 200g. Base (False Weight) = 800g.
P%=(<spanclass=vfrac><spanclass=num>200</span><spanclass=den>800</span></span>)×100=25%P\% = (<span class='v-frac'><span class='num'>200</span><span class='den'>800</span></span>) \times 100 = 25\%.

4. Buy X Get Y Free

Effective Discount calculation.
  • Rule: Free items are the Discount. Total items (Paid + Free) are the MP base.
  • Discount % = FreeTotal × 100.

Example:

Q: Buy 3 Get 2 Free. Discount %?
Solution: Free = 2. Total = 5.
D%=(<spanclass=vfrac><spanclass=num>2</span><spanclass=den>5</span></span>)×100=40%D\% = (<span class='v-frac'><span class='num'>2</span><span class='den'>5</span></span>) \times 100 = 40\%.

5. Successive Discounts

Net price after multiple discounts.
  • Formula: x+yxy/100x + y - xy/100 (Note the signs: D1D2+D1D2/100-D_1 - D_2 + D_1D_2/100).
  • Ratio: If 10% and 10% off: 109,109    1008110 \to 9, 10 \to 9 \implies 100 \to 81. Net 19% off.

Example:

Q: Two successive discounts of 20% and 10%.
Solution: Ratio: 545 \to 4 and 10910 \to 9.
503650 \to 36. Drop 14.
14/50=28%14/50 = 28\%. Or 2010+2=28%-20 -10 + 2 = -28\%.

7. The Two Articles Case

Common Scenario: Two items sold at same Price.
  • Case A: Same CP. x% Gain, x% Loss → No Profit No Loss.
  • Case B: Same SP. x% Gain, x% Loss → Always Loss of 100 %.

Example:

Q: Sold two cars at 1 Lakh each. One 20% profit, other 20% loss.
Solution: Same SP. Loss = 20²100 = 4%.

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