dealer sells a mobile phone at a profit of 25%. The customer sells it to a friend at ksh 60,000,
making a profit of 20 %. Find the cost prize of the mobile phone. (3 marks)
Let the cost price of the mobile phone be x.
The dealer sells the phone at a profit of 25%, so the selling price is 1.25x.
The customer then sells it at a profit of 20%, so the selling price is 1.2 * 60,000 = 72,000.
Therefore, 1.25x = 72,000,
x = 72,000 / 1.25 = 57,600.
So the cost price of the mobile phone is Ksh 57,600.
To solve this, we can set up two equations based on the given information.
Let's assume the cost price of the mobile phone is "x" Kenyan Shillings (Ksh).
According to the question, the dealer sells it at a profit of 25%. So, the selling price for the dealer would be x + 25% of x.
Selling price for the dealer = x + 0.25x = 1.25x.
Now, the customer buys the phone from the dealer and sells it to a friend at a profit of 20%.
Selling price for the customer = 1.25x + 20% of (1.25x).
Selling price for the customer = 1.25x + 0.2 * 1.25x = 1.25x + 0.25x = 1.5x.
According to the question, the customer sells the phone to a friend at Ksh 60,000, so we can set up the equation:
1.5x = 60,000.
To find the cost price of the mobile phone, we can solve this equation for x:
1.5x = 60,000
x = 60,000 / 1.5
x = 40,000
Therefore, the cost price of the mobile phone is Ksh 40,000.