Question : A wholesaler sells a jacket to a retailer at a profit of 5% and the retailer sells it to a customer at a profit of 10%. If the customer pays INR 4,158, what does it cost (in INR) to the wholesaler?
Option 1: 3,500
Option 2: 3,400
Option 3: 3,300
Option 4: 3,600
Correct Answer: 3,600
Solution :
Profit of wholesaler (Profit
1
) = 5% of cost price of the wholesaler
So, the selling price of the wholesaler = cost price of the wholesaler + 5% of cost price of the wholesaler
= 105% of cost price of the wholesaler
Profit of retailer (Profit
2
) = 10% of the selling price of the wholesaler
The selling price of the retailer = INR 4158
⇒ The selling price of the retailer = selling price of the wholesaler + profit
2
⇒ INR 4158 = 105% of cost price of the wholesaler + 10% of 105% of cost price of the wholesaler
⇒ INR 4158 = 105% of cost price of the wholesaler + 10.5% of cost price of the wholesaler
⇒ INR 4158 = 115.5% of cost price of the wholesaler
So, the cost price of the wholesaler = $\frac{4158}{1.155}$ = INR 3,600
Hence, the correct answer is 3,600.
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