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A handloom trader in Erode buys a bedsheet for ₹400 and sells it for ₹500. He tells the customer he is making only 20% profit. What is his actual profit percent?

Class 8Comparing QuantitiesComparing Quantities
  • A25%
  • B20%
  • C80%
  • D125%

Step-by-Step Solution

Profit = 500 − 400 = 100, and profit % is always taken on the COST price: %. The trader divided by the selling price instead %) — the classic wrong-base error. 80% and 125% merely compare CP with SP.
Answer: A) 25%

Key idea: Discount

A discount is a reduction off the **marked price** (MP), not the cost price. The selling price (SP) is what the customer actually pays.

**SP = MP − Discount**
**Discount % = (Discount / MP) × 100**

Example: shirt MP ₹800, discount 25%. Discount amount = 25% of 800 = 200. SP = 800 − 200 = 600.

Note: discount % is calculated on MP. Profit/loss % (Class 7) is on CP. Don't mix them up.

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