A wholesaler sells a machine part to a distributor at a profit of 20%, the distributor sells it to a retailer at a profit of 25%, and the retailer sells it to a customer at a profit of 30%. If the part cost the wholesaler ₹2000, the customer pays (in ₹):

Question

Accepted Answer

3900. Each profit is charged on the price that seller himself paid: 2000 × 1.20 = ₹2400, then 2400 × 1.25 = ₹3000, then 3000 × 1.30 = ₹3900. (Adding the three margins to 75% and charging 2000 × 1.75 = ₹3500 understates the price, because every later margin sits on a larger base.)

A wholesaler sells a machine part to a distributor at a profit of 20%, the distributor sells it to a retailer at a profit of 25%, and the retailer sells it to a customer at a profit of 30%. If the part cost the wholesaler ₹2000, the customer pays (in ₹):

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