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A shopkeeper reduces the price of a pen by 25% as a result of which the sales quantity increased by 20%. If the revenue made by the shopkeeper decreases by x% then x is

Question and options

A shopkeeper reduces the price of a pen by 25% as a result of which the sales quantity increased by 20%. If the revenue made by the shopkeeper decreases by x% then x is
  1. 20
  2. 45
  3. 25
  4. 10

Answer and explanation

Correct answer: D - 10

Revenue decreases by 10%10\%. Multiplying the price factor 0.750.75 by the quantity factor 1.201.20 gives 0.900.90 of the initial revenue. The value 25%25\% accounts for the price reduction alone and leaves out the increase in units sold.

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  • IPMAT Indore

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