Question

if a business man makes a profit of of 20% on the selling price then this profit percentage on the cost price will be

Answer 1

Let selling price = SP and cost price = CP

He makes 20 % on selling price means = >

(sp-cp) / sp = 20 % = 20/100 = 0.2

(sp - cp) / sp = 0.2

1 - cp/sp = 0.2

1 - 0.2 = cp/sp

0.8 = cp/sp

Reversing 1 / 0.8 = sp/cp = 1.25

We need to find profit on cost price means =

=(sp-cp)/ cp

= sp/cp - 1 = 1.25 - 1 = 0.25

Means 25 % profit on cost price : Answer

Hope that will help :)