CAT 2017 Slot 2 — QA Question 7
The manufacturer of a table sells it to a wholesale dealer at a profit of 10%. The wholesale dealer sells the table to a retailer at a profit of 30%. Finally, the retailer sells it to a customer at a profit of 50%. If the customer pays Rs 4290 for the table, then its manufacturing cost (in Rs) is
Answer & solution
- A
1500
2000
- C
2500
- D
3000
Lets the manufacturers C.P. be x
As he sells it to the wholesaler at 10% profit, his S.P will be 1.1x
Now 110 is also the wholesaler’s C.P. Further, as the wholesaler sells it to a retailer at 30%, profit, his S.P will be
× 1.1x = 1.43x
Now 1.43x also the retailers C.P
As the retailer sells it to the customer at
50% profit, S.P. will be × 1.43x or 2.145x
The price paid by the customer is Rs. 4290
⇒ 2.145x = 4290
⇒ x = 2000
So Rs. 2000 is the manufacturer’s cost
Hence, option (c).