Question

If the price of an item is decreased by 10\(\%\) and then increased by 10\(\%\), the net effect on the price of the item is,

• A. Decrease of 99\(\%\)
• B. No change
• C. decrease of 1\(\%\)
• D. An increase of 1\(\%\)

Answer 1

The Correct Option is C

Step 1: Let the original price of the item be \( x \). 

The price is first decreased by 10%, so the new price after the decrease is:

\[ x - 0.10x = 0.90x \]

Step 2: Increase the new price by 10%.

The new price after the increase is:

\[ 0.90x + 0.10 \times 0.90x = 0.90x \times 1.10 = 0.99x \]

Step 3: Determine the net effect.

The final price is \( 0.99x \), which is 99% of the original price.

Thus, the net effect on the price is a decrease of 1%.