Question 116

# A pharmaceutical company manufactures 6000 strips of prescribed diabetic drugs for Rs. 8,00,000 every month. In July 2014, the company supplied 600 strips of free medicines to the doctors at various hospitals. Of the remaining medicines, it was able to sell 4/5th of the strips at 25 percent discount and the balance at the printed price of Rs. 250. Assuming vendor’s discount at the rate of a uniform 30 percent of the total revenue, the approximate percentage profit / loss of the pharmaceutical company in July 2014 is:

Solution

It is given that a total of  6000 strips are manufactured out of which the company supplied 600 strips of free medicines to the doctors.

Hence, the number of strips which were sold = 6000 - 600 = 5400.

It is given that the company was able to sell 4/5th of the strips at 25 percent discount and the balance at the printed price of Rs. 250.

Total revenue generated by the firm = $$(0.75*250)*(\dfrac{4}{5}*5400)+(250)*(\dfrac{1}{5}*5400)$$ = Rs. 1080000

Net revenue after vendor’s discount = 0.7*1080000 = Rs. 756000

We can see that the company invested Rs. 800000 for the drug creation.

Hence, percentage loss incurred by the company = $$\dfrac{800000-756000}{800000}*100$$ = 5.5%

Therefore, option C is the correct answer.