Trade Discount Amount Calculation Explained

This question asks us to find the specific amount of the trade discount given to a shopkeeper. We are provided with the number of units purchased, the price per unit, and the rate of the trade discount. We also see information about a scheme discount, but we need to focus only on the trade discount for this calculation.

Calculating Total List Price

First, let's determine the total value of the purchase before any discounts are applied. This is often referred to as the list price.

• Number of units purchased: 100
• Price per unit: ₹50
• The formula for the total list price is:

$ \text{Total List Price} = \text{Number of Units} \times \text{Price per Unit} $

Plugging in the values:

$ \text{Total List Price} = 100 \times \text{₹}50 = \text{₹}5000 $

So, the total list price for the 100 units is ₹5000.

Calculating the Trade Discount Amount

Next, we calculate the actual amount of the trade discount. The question states the shopkeeper is given a 10% trade discount.

• Total List Price: ₹5000
• Trade Discount Rate: 10%
• The formula for the trade discount amount is:

$ \text{Trade Discount Amount} = \text{Total List Price} \times \text{Trade Discount Rate} $

To calculate this, we convert the percentage to a decimal or fraction:

$ 10\% = \frac{10}{100} = 0.10 $

Now, apply the rate to the total list price:

$ \text{Trade Discount Amount} = \text{₹}5000 \times 10\% = \text{₹}5000 \times \frac{10}{100} = \text{₹}500 $

Therefore, the trade discount amount is ₹500.

Understanding the Scheme Discount

The question also mentions a 5% scheme discount. This discount would typically be applied *after* the trade discount or calculated on a different base price depending on the terms. However, it is not needed to calculate the trade discount amount itself, which is what the question specifically asks for.

Final Answer

The calculation shows that the trade discount amount is ₹500.