Ravi sells two bicycles at the same price. On one bicycle, he earns a profit of 25%, while on the other, he incurs a loss of 25%. What is the overall result of these transactions?

(a) No profit, no loss
(b) Overall profit of 6.25%
(c) Overall loss of 6.25%
(d) Overall loss of 10%

Question

Ravi sells two bicycles at the same price. On one bicycle, he earns a profit of 25%, while on the other, he incurs a loss of 25%. What is the overall result of these transactions?

(a) No profit, no loss
(b) Overall profit of 6.25%
(c) Overall loss of 6.25%
(d) Overall loss of 10%

ONLiNE UPSC · Accepted Answer

Let the selling price of each bicycle be ₹100 (same for both).

For the first bicycle, Ravi makes a profit of 25%, so:

Cost Price (CP) = 100/1.25 = ₹80 

For the second bicycle, he suffers a loss of 25%, so:

Cost Price (CP) = 100/0.75 = ₹133.33 

Now, total cost price of both bicycles:

80 + 133.33 = ₹213.33 

Total selling price of both bicycles:

100 + 100 = ₹200 

Total loss = ₹213.33 &minus; ₹200 = ₹13.33
Loss % = 13.33/213.33 &times; 100 &asymp; 6.25% 

Hence, option c is correct.

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