By Mansi Yadav

Verified by Ajay Kumar

By selling a toy at a certain price, a merchant gains 10%. If he increases the price by Rs. 4, his gain becomes 12.5%. Find the cost price of the toy.

  1. ₹180

  2. ₹140

  3. ₹160

  4. ₹120

Answer: C

Solution

Solution: Let the cost price be x. The original selling price is \(1.10x\), and the increased selling price is \(1.125x\). Their difference is ₹4, so \(1.125x-1.10x=4\Rightarrow0.025x=4\Rightarrow x=160\). The cost price is ₹160. Trick: The increase in profit is 2.5% of the cost price; equate 2.5% of the cost price to ₹4.

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