Business Mathematics helps in understanding the everyday operations and handling them in commercial enterprises. The fundamental concepts of Business Math can be understood using the following keywords which are used frequently in the computations. They are, selling price, cost price, marked price, profit, loss, discount, simple interest and compound interest.
• The price at which a product is sold in the market is called the selling price, in short S.P.
• The product’s actual price is the cost price, in short it is C.P.
Profit and Loss
• Profit is the term used when a product’s selling price is more than the original or the cost price
• Loss is the term used when a product’s selling price is less than the original or the cost price
• The price at which a product is sold in a particular given market is the marked price, in short M.P.
• Discount is the term used when there is a deduction on the selling price of a product
Simple and Compound Interest
• The interest which is calculated on the Principal amount for a given period of time and at a given rate of interest is called the Simple Interest
• The accrued interest which is added to the Principal amount for a given period of time and at a given rate of interest is called the compound interest
Business Math Formulas are:
1. When there is a profit, S.P. = C.P x (100 + Profit)/100 and C.P= (100 x S.P.)/(100 + profit)
2. Profit % = (Profit/CP) x 100 %
3. Loss%= (Loss/CP) x 100%
4. When there is a loss, S.P. = C.P x(100 – Loss)/100 and C.P= (100 x S.P.)/(100 – Loss)
5. Discount is calculated on the Marked Price, Discount = Market Price – Selling Price
6. Discount Percentage = (Discount x 100)/Market Price
7. S.P = Marked Price x (100 – Discount)/100
8. Marked price can be calculated as (100 x S.P)/(100 – Discount)
9. Simple Interest = PNR/100, P=Principal, N= Time Period, R=Rate of interest
10. Compound Interest amount = P + (1 +r/100)^n, P=Principal, n=Time Period, r=rate of interest
Business Math Problems
Given P = $4500, R= 8% and N=4 years calculate the simple interest
Simple Interest = PNR/100=4500 x8 x4/100= $1440
The cost price of an article is $4500 and an extra expenditure on the article is $500. The article is sold for $5500. Calculate profit percent.
CP = 4500+500=$5000
SP=$5500
Profit = SP – CP = 5500 – 5000= $500
Profit %= (Profit/CP) x 100 % =(500/5000) x 100% = 10 %
• The price at which a product is sold in the market is called the selling price, in short S.P.
• The product’s actual price is the cost price, in short it is C.P.
Profit and Loss
• Profit is the term used when a product’s selling price is more than the original or the cost price
• Loss is the term used when a product’s selling price is less than the original or the cost price
• The price at which a product is sold in a particular given market is the marked price, in short M.P.
• Discount is the term used when there is a deduction on the selling price of a product
Simple and Compound Interest
• The interest which is calculated on the Principal amount for a given period of time and at a given rate of interest is called the Simple Interest
• The accrued interest which is added to the Principal amount for a given period of time and at a given rate of interest is called the compound interest
Business Math Formulas are:
1. When there is a profit, S.P. = C.P x (100 + Profit)/100 and C.P= (100 x S.P.)/(100 + profit)
2. Profit % = (Profit/CP) x 100 %
3. Loss%= (Loss/CP) x 100%
4. When there is a loss, S.P. = C.P x(100 – Loss)/100 and C.P= (100 x S.P.)/(100 – Loss)
5. Discount is calculated on the Marked Price, Discount = Market Price – Selling Price
6. Discount Percentage = (Discount x 100)/Market Price
7. S.P = Marked Price x (100 – Discount)/100
8. Marked price can be calculated as (100 x S.P)/(100 – Discount)
9. Simple Interest = PNR/100, P=Principal, N= Time Period, R=Rate of interest
10. Compound Interest amount = P + (1 +r/100)^n, P=Principal, n=Time Period, r=rate of interest
Business Math Problems
Given P = $4500, R= 8% and N=4 years calculate the simple interest
Simple Interest = PNR/100=4500 x8 x4/100= $1440
The cost price of an article is $4500 and an extra expenditure on the article is $500. The article is sold for $5500. Calculate profit percent.
CP = 4500+500=$5000
SP=$5500
Profit = SP – CP = 5500 – 5000= $500
Profit %= (Profit/CP) x 100 % =(500/5000) x 100% = 10 %
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