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Stuart paid $60 for purchasing a pair of identical chairs. He decided to sell the chairs at a price equal to the purchase price plus a markup that is 40 percent of the marked price, set by him. When he could not sell the chairs for one day, he discounted their marked price by 20 percent and quickly sold one chair. Worrying that he had underpriced the chairs, he raised the marked price of the remaining chair by 20 percent and sold it by the end of the day. What was his total profit or loss for the combined transactions?
  • a)
    10
  • b)
    18
  • c)
    28
  • d)
    38
  • e)
    48
Correct answer is option 'C'. Can you explain this answer?
Verified Answer
Stuart paid $60 for purchasing a pair of identical chairs. He decidedt...
Step 1: Question statement and Inferences
Both chairs have the same cost price but different selling prices. We need to find the price at which each chair sells, in order to calculate the total profit made by selling the two chairs.
Step 2: Finding required values
Stuart purchased two chairs for $60
So, Cost price of one chair, CP = 60/2 = $30
Let the marked price of each chair be MP
MP = CP + Markup
Given: Markup = 40% of MP
So, MP = CP + 40% of MP
Or, 60% of MP = CP
60100MP=CPMP=10060×30=50
 
After 1 day, he discounted the marked price by 20%
So,new Marked Price=MP′=MP–20% of MP
=80 % of MP
MP′=40
He sold one chair at this price.
His profit on selling this chair = P1 = MP′ – CP
P1 = 40 – 30
P1 =$ 10
For the unsold chair,
He raised the marked price by 20%
New Marked Price = MP′′=MP′+20 of MP′ 
MP′′ = 120 of MP′
MP′′=$48
He sold the second chair at this price.
His profit on selling this chair
= P2 = MP′′–CP
P2 = 48 – 30
P2 = $18
Step 3: Calculating the final answer
Total profit earned on the sale of the two chairs
= P1 + P2 = $10 + $18 = $28
Looking at the answer choices, we see that Option C is correct
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Stuart paid $60 for purchasing a pair of identical chairs. He decidedto sell the chairs at a price equal to the purchase price plus a markup that is 40 percent of the marked price, set by him. When he could not sell the chairs for one day, he discounted their marked price by 20 percent and quickly sold one chair. Worrying that he had underpriced the chairs, he raised the marked price of the remaining chair by 20 percent and sold it by the end of the day. What was his total profit or loss for the combined transactions?a)10b)18c)28d)38e)48Correct answer is option 'C'. Can you explain this answer?
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