Calculating Selling Price with a Loss in Economics

When a trader purchases an item and decides to sell it at a loss, the calculation involves a straightforward formula that takes into account the original buying price and the loss percentage. This article will walk you through the steps to calculate the selling price in different scenarios, ensuring you understand the concept thoroughly.

Example Scenario 1: A Buys a TV for 15200Rs and Sells It for a 20% Loss

Let's break down the example where a trader, A, buys a TV for 15200Rs and then sells it at a 20% loss. Calculating the selling price involves the following formula:

Selling Price Cost Price × (1 - Loss Percentage)

Identify the Cost Price (CP): CP 15200Rs Identify the Loss Percentage (LP): LP 20% Substitute the values into the formula:

Selling Price (SP) 15200 × (1 - 20/100) 15200 × 0.80

Now, let's perform the multiplication:

SP 15200 × 0.80 12160Rs

Example Scenario 2: A Sells a TV for a 8% Loss Given the Purchase Price of 2500

In another scenario, a trader A buys a TV set for 2500 Birr and sells it at an 8% loss. The selling price can be calculated as follows:

Identify the Cost Price (CP): CP 2500 Birr Identify the Loss Percentage (LP): LP 8% Substitute the values into the formula:

Selling Price (SP) 2500 × (1 - 8/100) 2500 × 0.92

Perform the multiplication:

SP 2500 × 0.92 2300 Birr

Understanding the Concepts

The key to understanding these calculations is to recognize that the selling price is a percentage of the cost price, adjusted for the loss or profit margin. Here are some key points to remember:

Loss Calculation Formula: Loss (CP - SP) / CP × 100 Profit Calculation Formula: Profit SP - CP

Practice Questions

If the purchasing price of the TV set is 15200Rs and it is sold with a 20% loss, calculate the selling price. If the selling price of a TV set is 20% less than its purchasing price of 2500 Birr, find the selling price. If someone sells an item for 8250Rs on a 2500Rs cost, what is the percentage of the loss?

These examples are designed to help you apply the concepts of cost price and selling price, as well as the calculation of loss. Understanding these calculations is essential for any trader or business owner, as it helps ensure profitable transactions.

Conclusion

By far, we have discussed the ways to calculate selling price and the concept of loss in economics. The principles we have illustrated are fundamental and widely applicable, and by practicing these examples, one can better manage their business or investments.