Sharpen your understanding of profit and loss calculations with real-world scenarios. This quiz covers key principles, terminology, and practical examples to help you grasp fundamentals of financial gains and losses in daily life.
A shopkeeper buys a watch for $40 and sells it for $50. What is the profit earned?
Explanation: $10 is correct because profit is calculated by subtracting the cost price from the selling price ($50 - $40 = $10). $90 is the total amount received minus nothing. $40 is only the cost price, not the profit. $50 is just the selling price, not the gain.
Sarah bought a bag for $80 but sold it for only $70. What was her loss?
Explanation: The loss is $10 since you subtract the selling price from the cost price ($80 - $70 = $10). $80 is the original cost, not the loss. $70 is how much she got from selling, not the loss. $150 is unrelated to either price and an unrealistic result.
A book is sold at a profit of $5, and its selling price is $30. What is the cost price?
Explanation: The cost price is $25 because you subtract the profit from the selling price ($30 - $5 = $25). $30 is the selling price, not the cost. $5 is only the profit amount. $35 would be more than the selling price and does not make sense.
If a pen is bought for $20 and sold for $25, what is the profit percentage?
Explanation: 25% is correct since profit is $5 ($25 - $20), and the profit percentage is ($5/$20) × 100 = 25%. 20% is a common mistake using the wrong base. 5% confuses absolute profit with percentage. 50% overstates the actual percentage.
An electronic gadget is bought for $100 and sold at $90. What is the percentage of loss?
Explanation: 10% is correct as the loss is $10, and dividing this by the original price ($10/$100 × 100) gives 10%. 5% and 9% are too low, and 11% is slightly over the correct value.
If an item is bought and sold at the same price of $55, what is the outcome?
Explanation: Selling at the same price leads to no profit or loss. Profit of $5 and loss of $5 are incorrect unless there is a change in the amounts. Profit of $55 is the total price, not the outcome.
A jacket is sold at 20% loss for $80. What was the cost price?
Explanation: $100 is correct because selling at a 20% loss means selling price is 80% of cost price. $80 divided by 0.8 gives $100. $64 and $60 are lower than both the selling and expected cost price. $96 is close but not the correct calculation.
An item costing $200 is sold with a 25% discount. What is the selling price?
Explanation: A 25% discount on $200 is $50, so the selling price is $150. $175 uses the wrong percentage. $50 is the discount, not the selling price. $225 is higher than the cost and not possible in a discount scenario.
If a painting is sold for $240 at a 20% profit, what was the original cost price?
Explanation: $200 is the correct answer because $240 is 120% of the cost price, so $240 ÷ 1.2 = $200. $220 and $250 use incorrect percentages, leading to the wrong result. $190 is below the actual cost for such a profit.
Samantha bought a phone for $150 and spent $20 on repairs before selling it for $155. What was her total loss?
Explanation: Her total cost is $170 ($150 + $20), and since she sells it for $155, the loss is $15. $10 and $5 underestimate by not including all costs. $25 is too high and exceeds the repair costs.