A shopkeeper gives a discount of 10% on his items. ₹ 280 is the marked

A shopkeeper gives a discount of 10% on his items. ₹ 280 is the marked price of an item. On selling this item, the shopkeeper earns a profit of 26%. What is the cost price of the item ?

₹ 260
₹ 240
₹ 200
₹ 180
This question was previously asked in
UPSC CISF-AC-EXE – 2022
The marked price (MP) of the item is ₹ 280. A discount of 10% is given. The selling price (SP) is calculated after applying the discount on the marked price.
Discount amount = 10% of ₹ 280 = (10/100) * 280 = ₹ 28.
Selling Price (SP) = Marked Price – Discount = ₹ 280 – ₹ 28 = ₹ 252.
The shopkeeper earns a profit of 26% on selling this item. Profit is calculated on the cost price (CP). The selling price is the cost price plus the profit.
SP = CP + Profit = CP + 26% of CP = CP + (26/100) * CP = CP * (1 + 0.26) = 1.26 * CP.
We have the selling price SP = ₹ 252 and the relationship SP = 1.26 * CP.
So, 252 = 1.26 * CP.
To find the cost price, divide the selling price by 1.26:
CP = 252 / 1.26 = 252 / (126/100) = (252 * 100) / 126.
Since 252 is twice 126 (2 * 126 = 252), the calculation simplifies:
CP = (2 * 126 * 100) / 126 = 2 * 100 = ₹ 200.
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