Mr.X a businessman had the income in the year 1995, such that he can-led a profit of 20% on his investment in the business. In the year 1996 his investment was less by Rs.5,000 but still had the same income (Income = Investment + Profit) as that in 1995. Thus the per cent profit earned in 1996 increased by 6%. What was his investment in 1995?
Mr.X a businessman had the income in the year 1995, such that he can-led a profit of 20% on his investment in the business. In the year 1996 his investment was less by Rs.5,000 but still had the same income (Income = Investment + Profit) as that in 1995. Thus the per cent profit earned in 1996 increased by 6%. What was his investment in 1995?
ARs.1,02,000
BRs.1,52,500
CRs.1,05,000
D Data inadequate
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Correct answer is: Rs.1,05,000
Explanation:
Let the investment in 1995 be Rs.x
Income in 1995 with 20% profit = 1.20x
Also the income in 1996 = 1.20x
Investment in 1996
= Rs.(x - 5000)
Profit in 1996 = (20 + 6)% = 26%
Income in 1996 with 26% profit
= 1.26 (x - 5000)
Therefore, 1.26 (x 5000) = 1.20x
0.06 x = 1.26 x 5000\(x = \Large \frac{6300}{0.06}\)
x = Rs.105000
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