Profit Percentage Calculation: When Selling Price is 1.5 or 5/3 Times the Cost Price

Understanding the relationship between selling price and cost price is crucial in business mathematics. This article explores how to calculate the profit percentage when the selling price is 1.5 or 5/3 times the cost price.

Introduction to Cost Price and Selling Price

In business, the cost price (CP) refers to the price at which goods are purchased. The selling price (SP) is the price at which these goods are sold. When the selling price is 1.5 or 5/3 times the cost price, it indicates a profit margin. This article will demonstrate how to calculate the profit percentage in such scenarios.

Calculation Methodology

The key formula used to calculate profit percentage is:

Profit Selling Price - Cost Price

Profit Percentage (Profit / Cost Price) * 100

Example Scenarios

Scenario 1: Selling Price is 5/3 Times the Cost Price

Let's consider a situation where the cost price (CP) of an article is x. The selling price (SP) is 5/3 times the cost price.

SP 5/3 * x

Determine the profit:

Profit SP - CP (5/3 * x) - x 2/3 * x

To find the profit percentage:

Profit Percentage (Profit / Cost Price) * 100 (2/3 * x / x) * 100 200/3 or 66.67%

Scenario 2: Selling Price is 3/2 Times the Cost Price

Let's take another example where the selling price is 3/2 times the cost price.

Let the CP of the article be Rs. y. Thus, the SP becomes 5/3y.

Determine the gain:

Gain SP - CP 5/3y - y 2/3y

Calculate the gain percentage:

Gain Percentage (Gain / CP) * 100 (2/3y / y) * 100 200/3 or 66.67%

Scenario 3: Cost Price is 100 Units

Suppose the cost price (CP) is 100 units. The selling price (SP) is 5/3 * 100 500/3 units.

Determine the gain:

Gain 500/3 - 100 200/3 units

Calculate the gain percentage:

Gain Percentage (Gain / CP) * 100 (200/3 / 100) * 100 66.67%

Final Calculation

From all the given scenarios, it is evident that if the selling price is 5/3 or 1.5 times the cost price, the profit percentage is consistently found to be 66.67%.

Conclusion

Understanding how to calculate profit percentage based on the relationship between selling price and cost price is fundamental for businesses. In this article, we demonstrated that when the selling price is 5/3 or 1.5 times the cost price, the resulting profit percentage is 66.67%. This example can be easily applied to various other scenarios within the business context.