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Let the cost price be ₹100. Selling price with 20% profit = ₹120. New cost price after a 25% increase = ₹100 + 25% of ₹100 = ₹125. Profit or loss = Selling Price - New Cost Price = ₹120 - ₹125 = -₹5 (loss). Loss percentage = (Loss / New Cost Price) × 100 = (5 / 125) × 100 = 4%. Correct answer: b) 4% loss
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