Problem in Profit and Loss
Two merchants sell, each an article for Rs.1000. If Merchant A computes his profit on cost price, while Merchant B computes his profit on selling price, they end up making profits of 25% respectively.
By how much is the profit made by Merchant B greater than that of Merchant A?
(1) Rs.66.67
(2) Rs. 50
(3) Rs.125
(4) Rs.200
Can some one help me out in solving this problem?
Merchant A:Calcualtes the
Merchant A: Calcualtes the profit on CP. He is selling the article for 1000 and getting a profit of 25%. Let the CP be X (say CP is 100) then Selling price will be 1.25X (for 100 cp, SP will be 125 to get 25% profit) profit=[(SP-CP)/CP * 100] Now 1.25X=1000 => X = 1000/1.25 =800 So cost price for merchant A = 800 and selling price is 1000 Thus profit = 200 Merchant B: Calcualtes the profit on SP. He is selling the article for 1000 and getting a profit of 25%. then Cost Price can be calcualted as profit=[(SP-CP)/SP ]* 100 =>25= [(1000-CP)/1000]*100 =>CP=750 and profit=250 So, the profit made by merchant B is 50 more than A.