Discussion
How much percent must be added to the cost price of goods so that a profit of 20% must be made after throwing off a discount of 10% from the labeled price?
Answer: D
Take the cost price as 100 and let the labelled price be \( M \). After a 10% discount the seller must still clear a 20% profit.
\[ M \times (1 - 0.10) = 100 \times 1.20 \]
\[ 0.9M = 120 \quad\Longrightarrow\quad M = \frac{120}{0.9} = 133.33 \]
\[ \text{increase over cost} = 133.33 - 100 = 33\tfrac{1}{3}\% \]
Adding 20% and 10% to get 30% is the trap: the profit is measured on the cost price while the discount comes off the labelled price, so the two act on different bases.
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