# GMAT Quant | GMAT Profits Practice Q10

###### GMAT 600 Level Problem Solving Question | Profit & Loss

The given question is a GMAT 600 level problem solving question in Profit and Loss. This GMAT sample question tests the concept of finding the percent profit or percentage loss made by a merchant.

Question 10: If the cost price of 20 articles is equal to the selling price of 25 articles, what is the % profit or loss made by the merchant?

1. 25% loss
2. 25% profit
3. 20% loss
4. 20% profit
5. 5% profit

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### Explanatory Answer | GMAT Profits Q10

#### Step 1 of solving this GMAT Profits Question: Assume a value for cost price

Let the cost price of 1 article be $1. Therefore, cost price of 20 articles = 20 × 1 =$20
The selling price of 25 articles = cost price of 20 articles = $20. #### Step 2 of solving this GMAT Profits Question: Compute the profit made on sale of 25 articles Let us find the cost price of 25 articles. Cost price of 25 articles = 25 × 1 =$25
Therefore, profit made on sale of 25 articles = Selling price of 25 articles − cost price of 25 articles
⇒ 20 − 25 = −$5 #### Step 3 of solving this GMAT Profits Question: What is the % Profit or Loss? Because the profit is in the negative, the merchant has made a loss of$5.
Therefore, % loss = $$frac{\text{Loss}}{\text{Cost Price}}$ × 100 % loss = $\frac{\text{5}}{\text{25}}$ × 100 = 20% loss. The merchant made a loss of 20% ##### Choice C is the correct answer. ###### GMAT Online Course - QuantTry it free! Register in 2 easy steps and Start learning in 5 minutes! ###### Already have an Account? ###### GMAT Live Online Classes Next Batch Dec 3, 2020 ###### GMAT Coaching in Chennai Next Integrated$Online + Offline) Batch
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