Correct Answer - Option 2 : 26%
Given∶
He marked the price of a painting so as to include a profit of 50%
He also allowed a discount of 16% on marked price.
Formula Used∶
S.P. = M.P. - Discount
Profit = S.P. - C.P.
Calculation∶
M.P. = C.P. + 50% of C.P. = 1.50 C.P.
Discount of 16% is on this M.P.
Discount = 16% of 1.50 C.P. = 0.24 C.P.
Also, S.P. = M.P. - Discount
So, S.P. = 1.50 - 0.24 = 1.26 C.P.
Profit = S.P. - C.P. = 1.26 - 1 = 0.26 = 26%
∴ The actual profit was of 26%.