Dr. Maryam Al Amri, a professional medical doctor has recently bought the new clinic. During Ramadan offer, she went to the Nesto Electronics to buy the Air Conditioner for her clinic. The Nesto has wide range of ACs but she selects Samsung V5.4 model. The product was priced RO 270 and Nesto was offering 20 % discount on the selling price. During the conversation with Nesto Manager, Dr. Maryam came to know that Nesto had bought this AC from the manufacturer for RO 200.

a) What is the Nestos markup rate on cost and how much is the markup amount?

b) What is the amount of discount Nesto is offering?

c) How much amount Dr. Maryam has to pay to buy the AC?

d) If Nestos rate of markup is 20% on cost, what would be the selling price of the AC?

e) Does discount encourages more sales? Discuss critically