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PROFIT, LOSS & DISCOUNT
FOR GMAT CAT
ARPIT
Manufacturer ( i.e. the producer)
Wholesaler (dealer)
Retailer (shopkeeper)
Customer
Cost Price – The cost incurred by the
manufacture or the wholesaler or the retailer
( i.e. the person who pass on the goods to
another)
Selling price – The price at which one person
pass on the goods to another .
Profit – The extra money a person receives by
selling a product .
Profit = Selling Price (SP) – Cost Price (CP)
Loss – The less amount that a person receives
by selling a product.
Loss = CP - SP
Important Formulae:
Profit Percentage = (Profit/CP) * 100
Loss Percentage = (Loss/CP) * 100
* Profit or loss is always calculated on the
basis of cost price unless otherwise
mentioned in the problem
Marked Price – The price written on the tag of
a product . It may or may not be equal to
the SP, depending upon the discount
(available or not).
Discount – The amount of money which is to
be paid less on the marked price (MP).
Marked Price = CP + Markup
Selling Price = MP – Discount
In general, CP<SP<MP
CP=SP<MP
SP<CP<MP
at a profit
at no profit no loss
at a loss
Some Important Concepts:
1.) When two articles are sold at same price
but one of them at a profit & another one
at a loss & the percentage profit is the
same as the percentage loss. In this case
there is always a loss.
Loss (%) = (Common gain or loss/ 10)2
2.) When a person recovers the cost price of
‘m’ articles by selling ‘n’ articles (n<m),
then
Profit (%) = (goods left/ goods sold) * 100
=
((m-n)/n)*100
CI/SI/ Instalments:
Simple Interest : Fixed rate of interest on principal
(initial amount).
Principal: Initial amount invested /loaned/borrowed.
Amount = Principal + Interest
Compound Interest : It is the interest on interest
calculated on each successive period.
Simple Interest (SI) = (P*R*T)/100
Where,
P= Principal
R= Rate of Interest (%)
T= Time Period
A = P + (P*R*T)/100 [ for SI only ]
Conversion of Time Period –Rate of Interest
Given (R%)
Given (t)
Required (R%)
Required (t)
R% annual
T years
r/2 (%) half- yearly
2t
R% annual
T years
r/4 (%) quarterly
4t
R% annual
T years
r/12 (%) monthly
12t
Compound Interest (CI) = A- P
Amount (A) = P(1+r/100)t
Difference b/w CI & SI for two years:
= P(r/100)2
Difference b/w CI & SI for 3 years:
= P(r/100)2 (r/100 + 3)
Population Questions :
P = P0 ( 1 + r/100)n
when population increases
P0 is the initial population
P = P0 ( 1 - r/100)n
when population decreases
Installments:
For SI
A = [ x + (x + (x*r*1)/100) + (x + (x*r*2)/100) +
……………..]
Where X = value of each installment
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