percentage problem

[jalshri]

A shopkeeper purchases birdfeeders for $10 each and sells them for $18 each. If the cost of the feeders increases by 50% for two months in a row , what is the smallest percent increase the shopkeeper can apply to the selling price in order to avoid selling at a loss?
ANS : 25

[nareshchowdary28]

Jalshri,


Consider the number of birdfeeders that shopkeeper purchase is 10
1st Month - 10*10 = 100
selling price - 10*18 = 180 (profit = 80)

2nd month - 15*10 = 100 (cost of the birdfeeder increased)
Selling Price - 180 (Still profit if he sells for 180 also so there is no need to increase the selling price)

3rd Month - 22.5*10 = 225
Selling price - 180 (but this time it is loss as selling price is less than cost )
So to avoid the loss the shopkeeper has to sell the birdfeeders at least for 225 instead of 180
so he has to increase the price from 180 to 225
225-180 = 45
Therefore the percent of increase in selling price = (225-180)/180
= 25%

Cheers,
Naresh

[tommywallach]

Another great explanation from Naresh. Notice the usage of smart numbers (plugging in 10 for the number of bird-feeders) to make this math much easier.

Also, when posting a question, please do explain how far you got, and what about the problem you found confusing or difficult.

Thanks!

-t