Practice Quiz

GMAT Math Practice Test #1

Category - Math

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The marked price is 10% higher than the cost price. A discount of 10% is given on the marked price. The seller _____
  1. loses 11%
  2. loses 1%
  3. bears no loss, no gain
  4. gains 9%
  5. gains 9.5%
Explanation
Answer B - Assume cost price = 100, marked price = 100+10% = 110
10% Discount on marked price110 = 10 x 110/100 = 11 . Net sale price = marked price- discount = 110-11 = 99 . Loss = 99-100 =1 i.e. 1%

Key takeaway: In profit and loss problem, if absolute figures are not available it is easy to develop the problem taking 100 as base figure. Work out percent step by step.
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