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    Question

    A shopkeeper sets the selling price of an item higher

    than its cost price. After offering a 4% discount, the shopkeeper earns a 20% profit. What percentage above the cost price did the shopkeeper initially mark the item?
    A 22% Correct Answer Incorrect Answer
    B 25% Correct Answer Incorrect Answer
    C 15% Correct Answer Incorrect Answer
    D 30% Correct Answer Incorrect Answer

    Solution

    Let the selling price of the item be Rs. '120x'.Price at which the item is marked above its cost price = (120x/0.96) = Rs. '125x'Cost price of the item = (120x/1.2) = Rs. '100x'Required percentage = (125x – 100x)/100x X 100 = 25%

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