The marked price of mustard oil is 25% more than its cost price. At what percentage less than the marked price should it be sold to have no profit and no loss?

The correct answer is 20%.

Let's solve this step by step.

Step 1: Assume a convenient Cost Price (CP)

Let the Cost Price (CP) of mustard oil = ₹100

Step 2: Calculate the Marked Price (MP)

The marked price is 25% more than the cost price:

\mathrm{MP}=\mathrm{CP}+25\%of\mathrm{CP}

\mathrm{MP}=100+25=125

Step 3: Determine the Selling Price (SP) for no profit and no loss

For no profit and no loss, the Selling Price must equal the Cost Price:

\mathrm{SP}=\mathrm{CP}=100

Step 4: Calculate the discount on the Marked Price

The amount by which the marked price must be reduced (discount):

\text{Discount}=\mathrm{MP}-\mathrm{SP}=125-100=25

Step 5: Calculate the discount percentage relative to the Marked Price

\text{Discount \%}=\frac{\text{Discount}}{\mathrm{MP}}\times 100

\text{Discount \%}=\frac{25}{125}\times 100=20\%

Conclusion:

The mustard oil should be sold at 20% less than the marked price to achieve no profit and no loss. The key insight here is that while the marked price is 25% more than CP (calculated on CP), the required discount of 25 needs to be expressed as a percentage of the higher marked price (₹125), which gives a smaller percentage — 20%.