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A refrigerator is available for Rs. 13750 including VAT. If the rate of VAT is $10 %,$ find the original cost of the refrigerator.

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Rs.12500

Rs.13500

Rs.10500

Rs.11500

answer is C.

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Detailed Solution

Given that selling price (SP) =Rs.13750 and rate of value-added tax = 10%.
Let the original cost of the refrigerator be Rs.X.
Therefore,

Original cost × Rate of tax 100 = X × 10 100 ⇒ 10 X 100 ⇒ Rs .0 .1 X

Now,

Cost price = Selling price − Value added tax ⇒ X =Rs .13750 − Rs .0 .1 X Original cost = X ⇒ 1 .1 X =Rs .13750 ⇒ X =Rs . 13750 1.1 ⇒ X = Rs .12500

Thus, the original cost of the refrigerator is Rs.12500.
Therefore, option (3) is correct.

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