A bought a tape recorder for Rs 8,000 and sold it to B. B in turn sold it to C, each earning a profit of 20%. Which of the following is true:
(a) A and B earn the same profit.
(b) A earns more profit than B.
(c) A earns less profit than B.
(d) Cannot be decided.
(c) A earns less profit than B
Explanation: Cost price of tape recorder bought by A = Rs.8000
Cost price of tape recorder for B =20% profit on cost price for A
=20/100 x 8000 + 8000
=20 x 80 + 8000
=1600 + 8000
=Rs.9600
Cost price of tape recorder sold to C = 20% profit on cost price for B
= 20/100 x 9600 + 9600
=1929 + 9600
= Rs.11520
Here, profit for A= Rs.1600 Profit for B = Rs.1920
So, A earns less profit than B.
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