The shopkeeper increased the price of a product by 25% so that customer

Ques -The shopkeeper increased the price of a product by 25% so that customer finds difficult to purchase the required amount. But Somehow the customer managed to purchase only 70% of the required amount. What is the net difference in the expenditure on that product ?

A. 55 more

B. 10% more

C. 12.5% less

D. 17.5% less

E. None of these

Solution -

Let,

The the initial price of the product = 100

The initial quantity of the product = 100

Quantity × Price = Expenditure

100 × 100 = 10000

Now,

Increased price of the product = 100 + 25% of initial price

= 100 + (25/100) × 100

= 100 + 25

= 125

Customer managed to purchase only 70% of the required amount.

New Quantity × New price = New Expenditure

70 × 125 = 8750

The net difference in the expenditure on that product = 10000 - 8750 =1250

In Percentage decrease = (1250/10000) × 100

= 12.5%

Hence,

THe correct answer is (c) 12.5% less.