Question

If the cost price is 80% of the selling price, then what is the profit in percentage?

• A. 20%
• B. 25%
• C. 16%
• D. 22.5%

Answer 1

The Correct Option is B

To solve the problem of finding the profit percentage when the cost price is 80% of the selling price, we can use the following steps:

1. Define Variables: Let the Selling Price (SP) be \(S\). The Cost Price (CP) is then given as 80% of the Selling Price. Therefore, \(CP = 0.8 \times S\).
2. Calculate Profit: Profit is determined by the formula:

\(\text{Profit} = \text{Selling Price} - \text{Cost Price} = S - 0.8 \times S = 0.2 \times S\)

1. Calculate Profit Percentage: The profit percentage is given by:

\(\text{Profit Percentage} = \left( \frac{\text{Profit}}{\text{Cost Price}} \right) \times 100 = \left( \frac{0.2 \times S}{0.8 \times S} \right) \times 100\) 

1. Simplifying the expression:

\(= \left( \frac{0.2}{0.8} \right) \times 100 = 0.25 \times 100 = 25\%\)

1. Conclusion: The profit percentage is 25%. Therefore, the correct answer is 25%.