Question

A broadband provider marks up the cost price of an internet plan by 50% and offers a discount of 20%. He asks the customer to pay GST of 18% on the selling price. The customer refuses to pay the tax due to which the provider himself pays the GST. Find his profit or loss percentage.
1. \(2\frac{3}{5}\%\) Loss
2. \(1\frac{3}{5}\%\) Profit
3. \(2\frac{3}{5}\%\) Profit
4. No profit no loss
5. \(1\frac{3}{5}\%\) Loss

Answer 1

Correct Answer - Option 5 : \(1\frac{3}{5}\%\) Loss

Given:

Provider marks up 50% above the CP

Discount % = 20%

GST = 18%

Concept used:

Loss = CP – SP

Loss% = {(CP – SP)/CP} × 100

CP = cost price

SP = selling price

MP = marked price

Calculation:

Let CP of internet plan be 2x

MP = 2x × 150% = 3x

SP = 3x × 80% = 12x/5

According to the question,

The provider has paid GST of 18% on SP

So,

Actual amount got by the provider = 12x/5 × 82/100

⇒ 492x/250

Loss = {2x – (492x/250)}

⇒ (500x – 492x)/250

⇒ 8x/250

Loss percentage = {(8x/250)/2x} × 100

⇒ (8x/500x) × 100

⇒ 8/5

⇒ \(1\frac{3}{5}\%\)

∴ Required loss percentage is \(1\frac{3}{5}\%\)