A shop owner offers the following discount options on an article to a customer: 1. Successive discounts of 10% and 20%, and then pay a service tax of…

Correct Option

All the options are equally good for the customer.

To determine the most advantageous option for the customer, we calculate the final price payable under each scenario, assuming an initial article price of Rs. 100.

Option 1: Successive discounts of 10% and 20%, then 10% service tax.

• Initial price: Rs. 100
• Price after 10% discount: $100 - \frac{10 \times 100}{100} = \text{Rs. } 90$100−10010×100​=Rs. 90
• Price after subsequent 20% discount on Rs. 90: $90 - \frac{20 \times 90}{100} = 90 - 18 = \text{Rs. } 72$90−10020×90​=90−18=Rs. 72
• Final price after 10% service tax on Rs. 72: $72 + \frac{10 \times 72}{100} = 72 + 7.2 = \text{Rs. } 79.2$72+10010×72​=72+7.2=Rs. 79.2

Option 2: Successive discounts of 20% and 10%, then 10% service tax.

• Initial price: Rs. 100
• Price after 20% discount: $100 - \frac{20 \times 100}{100} = \text{Rs. } 80$100−10020×100​=Rs. 80
• Price after subsequent 10% discount on Rs. 80: $80 - \frac{10 \times 80}{100} = 80 - 8 = \text{Rs. } 72$80−10010×80​=80−8=Rs. 72
• Final price after 10% service tax on Rs. 72: $72 + \frac{10 \times 72}{100} = 72 + 7.2 = \text{Rs. } 79.2$72+10010×72​=72+7.2=Rs. 79.2

Option 3: Pay 10% service tax first, then successive discounts of 20% and 10%.

• Initial price: Rs. 100
• Price after 10% service tax: $100 + \frac{10 \times 100}{100} = 100 + 10 = \text{Rs. } 110$100+10010×100​=100+10=Rs. 110
• Price after subsequent 20% discount on Rs. 110: $110 - \frac{20 \times 110}{100} = 110 - 22 = \text{Rs. } 88$110−10020×110​=110−22=Rs. 88
• Final price after subsequent 10% discount on Rs. 88: $88 - \frac{10 \times 88}{100} = 88 - 8.8 = \text{Rs. } 79.2$88−10010×88​=88−8.8=Rs. 79.2

As the final payable amount is Rs. 79.2 in all three options, all options are equally beneficial for the customer.

Incorrect Options:

Options 1, 2, and 3 are incorrect because the detailed calculations demonstrate that the final price payable by the customer is identical across all three scenarios. Therefore, none of the individual options provides a superior advantage over the others, making the assertion that one option is "the best" inaccurate.