A public car dealer marked up the cost of a car at 30% in an attempt to make 20% gross profit. Due to the value of dollar, he now placed 20% discount on the car. What profit or loss will he make?

  • A 3%
  • B 2%
  • C 4%
  • D 1%
jamb 2015mathematics

The correct answer is C. 4%

Let assume the cost price is 100%

Marked up price + cost price = 20 + 100 = 120%

Discount at 20% = 20/100 × 120 % of cost price

Selling price = cost price − gain

= (120 − 24)% of cost price

= 96% of cost price

Loss = (100− 96)% of cost price

= 4% of cost price

∴ He will wake 4% loss

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