Q2 of 16 Page 98

Sumit borrowed a capital of Rs. 50,000 to start his food products business. In the first year he suffered a loss of 20%. He invested the remaining capital in a new sweets business and made a profit of 5%. How much was his profit or loss computed on his original capital?

Capital borrowed by Sumit = Rs 50,000


Now, Loss in first year = 20% of Rs 50,000


=


= Rs 10,000


∴ Remaining capital = Rs 50,000 – Rs 10,000


= Rs 40,000


Then,


He invested remaining capital in sweet business and had a profit of 5%.


∴ Profit amount = 5% of 40000


=


= Rs 2000


He occurred a profit of Rs 2000.


∴ The capital will be Rs 40000 + Rs 2000


= Rs 42,000.


Now,


Original capital = Rs 50,000


New capital after 2 years = Rs 42,000


∴ Loss% =


=


= 16%


Hence, his capital after 2 years = Rs 42,000 & he suffered a loss of 16% on the initial capital.


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