Profit and Loss – Markup followed by discount: The marked price is 10% higher than the cost price. A discount of 10% is then given on the marked price. In this sale, does the seller gain or lose, and by what percent?

Introduction / Context:Successive percentage changes are multiplicative, not additive. A markup followed by an equal discount usually does not return to the original price.

Given Data / Assumptions:

• MP = 1.10 * CP
• Discount on MP = 10% ⇒ SP = 0.90 * MP

Concept / Approach:Compute SP relative to CP and compare.

Step-by-Step Solution:SP = 0.90 * (1.10 * CP) = 0.99 * CPHence, SP is 1% below CP ⇒ 1% loss

Verification / Alternative check:Let CP = 100; MP = 110; SP = 99; loss = 1.

Why Other Options Are Wrong:No-profit-no-loss is false because 0.99 ≠ 1. 1% gain and 2% effects are incorrect directions or magnitudes.

Common Pitfalls:Averaging +10% and -10% to get 0%.

Final Answer:1% loss