Que: Charlie sold his car at a profit of 30 percent of the price that he originally paid......

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Que: Charlie sold his car at a profit of 30 percent of the price that he originally paid for the car and then bought another car at a price of 60 percent less than the price he originally paid for his first car. If he sold the first car for $26,000, what was his net gain or loss, in dollars, for the two transactions?

(A) $6,000 gain
(B) $6,000 loss
(C) $8,000 loss
(D) $8,000 gain
(E) $18,000 gain

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Solution: Selling Price of the first car: $26,000

=> This was sold at 30 percent profit. This means C.P. * \(\frac{130}{100}\) = 26,000.

=> C.P. of the first car: \(26,000\cdot\frac{100}{130}=20,000\)

=> C.P. of second car: 60 percent less than the C.P. of first car: \(20,000\cdot\frac{40}{100}=8,000\)

=> C.P. 1 = 20,000

=> S.P. 1 = 26,000

=> Profit 1 = 26,000 – 20,000 = 6,000

=> C.P. 2 = 8,000

=> Gain in second car: 20,000 – 8,000 = 12,000

=> Overall loss: 6,000 - 12,000 = -6,000

Therefore, B is the correct answer.

Answer B