Guide
Profit, loss, discount and interest repeatedly appear as standalone questions and as layers inside broader arithmetic sets. For CAT preparation, the useful question is not “Have I finished the chapter?” but can I recognise the version of the concept CAT hides inside a word problem and choose an efficient method under time pressure?
What to know
The core checklist for this topic is: Cost price, selling price, marked price, profit/loss%, discount, successive discounts; and markup, false weights, simple interest, compound interest, effective annual rate. Learn these as connected ideas rather than isolated formulas. CAT often combines two of them in one question.
Recurring CAT-style forms
Expect questions built around Markup + discount while preserving profit, two articles sold at same SP, successive discount, dishonest dealer, instalments/interest, and comparing SI and CI. The wording changes, but the mathematical structure repeats. Your first 20–30 seconds should be spent identifying that structure before writing equations.
Decision rules worth remembering
- Profit% is normally on CP
- discount% on MP
- SP=CP(1±p/100)
- two successive discounts combine as a+b−ab/100
- CI growth is multiplicative
One original example
Take CP=₹100. If an item is marked 40% above cost and discounted 20%, SP=140×0.8=₹112, so profit is 12%—not 20%.
The point of a worked example is not the answer; it is the choice of representation. After solving, ask whether a ratio table, base-100 assumption, sign chart, factorisation or diagram made the work shorter.
Common traps
- Applying profit % to SP
- adding successive discounts
- assuming same % profit and loss cancel
- forgetting time period compounding
- mixing absolute profit with profit rate
These traps are valuable because they explain why a student can “know the formula” and still lose marks. Add the exact mistake to your error log when it occurs; do not simply write “silly mistake.”
How to practise
Start with 10–15 untimed questions until the first step becomes automatic. Then use mixed timed sets where this topic is not announced in advance. Finish with sectionals and mock review. Mastery checkpoint: Can derive rather than memorise markup/discount chains and choose 100 as CP/MP intelligently.
Once that checkpoint is stable, move on rather than over-polishing one chapter. CAT QA is a portfolio of scoring areas; the objective is enough reliable topics to make question selection easy on exam day.
Preparing for CAT?
See where you actually stand before changing your shortlist or study plan.
Why On Your Mocks?
A mock score tells you what happened. OYM helps you understand what went wrong and what to work on next.