Class Notes

Comparing Quantities

Grade 08
 Topics to be Covered

1. Fractions, Ratios and

Percentages

1.1. Fraction
1.2. Ratio
1.3. Percentage
1.4. Converting ratio to
percentages
2. Profit and Loss 1.5. Percentage change

2.1. Cost price

2.2. Selling price
2.3. Discount
2.4. Profit percentage
2.5. Loss percentage
2.6. Overhead expenses
3. Taxation

4. Interest
4.1. Simple interest
4.2. Compound interest
4.3. Simple interest versus
compound interest
4.4. Conversion period
4.5. Application of compound
interest formula
 Mind Map

Converting
Fraction ratio to
percentages
Ratio Percentage

Ratio and Percentages Simple

interest

Comparing
Taxation Interest
Quantities

Compound
Prices Related to interest
Buying and Selling

Overhead
Discount
expenses
Cost price Profit and
and selling loss
price percentage
 1. Fractions, Ratios and Percentages

1.1. Fraction

• Fraction is a part of a whole. It is represented

as a .
b
1
=
4

1.2. Ratio

• The ratio of two quantities 𝑎 and 𝑏 of the same kind

and same units is the fraction which is written as 𝑎 ∶ 𝑏,
read as ‘𝑎 is to 𝑏’.

= 1:4

1.3. Percentage

• A percentage is a number or ratio that can be

expressed as a fraction of 100.

1
= 25%
x 100%
4
 1. Fractions, Ratios and Percentages

1.4. Converting ratio to percentages

To convert ratio into percentage we use the following

formula:
Percentage = Ratio in fraction form × 100%

For example:
Ratio to percentage
Ratio Percentage
conversion
𝟏
𝟏∶ 𝟒 × 𝟏𝟎𝟎% 𝟐𝟓%
𝟒
𝟖
𝟖∶ 𝟓 × 𝟏𝟎𝟎% 𝟏𝟔𝟎%
𝟓
 1. Fractions, Ratios and Percentages

1.5. Percentage change

Amount of change
• Change in percentage = × 100%
Initial Value

• Percentage change is always calculated on the initial

value. Change can be either an increase or a decrease.

% change
• New value = Initial value ± × Initial value
100

For example:

Initial number of washing machines sold = 8

Final number of washing machines sold = 8 + 2 = 10

Amount of change
Increase in percentage = × 100%
Initial value
10 − 8
= × 100% = 25%
8

When old value is same as the new value then there

is neither a decrease nor an increase in the quantity
and the net percentage change is 0%.
 2. Prices Related to Buying and Selling

2.1. Cost price

Cost price (C.P.) is the total price a product costs to the

seller.

C.P.

Warehouse Seller

2.2. Selling price

Selling price (S.P.) is the price at which a product is sold

to the customer.

S.P.

Seller Customer
 2. Prices Related to Buying and Selling

2.3. Discount

Discount is a reduction given on the marked price (M.P.) of

an article.
Discount = Marked price − Sale price
Discount
Discount % = × 100%
Marked Price

Example:
An item is marked at ₹100 is sold at ₹80. What is discount
and discount percent?
Discount = ₹100 – ₹80 = ₹20
20
Discount % = × 100% = 20%
100

2.4. Profit percentage

The amount gained on cost price by selling a product.

If the selling price (S.P.) of the product is more than the cost
price (C.P.) of a product, then it is considered as a gain or
profit.
• When S.P. > C.P., we have
Profit = S.P. − C.P.
Profit
Profit % = × 100%
Cost price
 2. Prices Related to Buying and Selling

2.5. Loss percentage

• The amount lost on cost price by selling a product.

• If the selling price (S.P.) of the product is less than the
cost price (C.P.) of a product, then it is considered as a
loss.
• When S.P. < C.P., we have
Loss = C.P. − S.P.
Loss
Loss % = × 100%
Cost price

2.6. Overhead expenses

• A seller may spend some extra money on a product than

its actual cost.
• Cost Price = Buying Price + Overhead Expenses
• Overhead expenses can be
• Transportation charge
• Packaging charge
• Labour cost
• Maintenance charge
• Example: A car is bought by the seller at ₹𝑥 and if
transportation charge for the car is ₹𝑦, then the cost price
of the car is ₹ 𝑥 + 𝑦 where ₹𝑦 is overhead expenses.
 3. Taxation

Sales tax (ST)

Sales tax (ST) is charged by the government on the sale of

an item and is added to the bill amount.

Sales tax (ST)

Value-added tax (VAT) is another form of tax added at

every stage of transfer of goods or services.

Sales tax (ST)

Goods and services tax (GST) is another form of tax levied

on supply of goods or services or both.

The taxes are calculated on the selling price of the

commodity.

• Tax = Tax % × Bill amount

• Total amount = Bill amount + Tax
 3. Taxation

More about GST

GST or the Goods and Services Tax, came into effect in

India from 1st July 2017. This replaces all the indirect
taxes levied on most goods and services such as VAT, excise
duty, luxury tax, and so on.

Luxury
VAT
tax

Entry tax GST CST

One nation,
Local tax one tax Excise

Entertainment
OCT ROI tax
 4. Interest

4.1. Simple Interest

Simple interest is a method to calculate the amount of
interest charged on a sum at a given rate and for a given
time period.
𝐏×𝐑×𝐓
• Simple interest (SI) =
𝟏𝟎𝟎

• Principal (P): It is the amount that is initially borrowed

from the bank or invested in the bank.
• Time (T): It is the duration in years for which the
principal amount is borrowed or invested.

• Rate (R): It is the rate of interest in % at which the

principal amount is borrowed or invested.

4.2. Compound Interest

• Compound interest is an interest accumulated on the
principal and final amount together over a given time
period.
𝑅 𝑛
• 𝐴= 𝑃 1+ 100
• A = Amount after 𝑛 years
• P = Principal
• R = Rate of interest
• 𝑛 = Number of years
• 𝐶𝐼 = 𝐴 − 𝑃
𝑅 𝑛
= 𝑃 1 + 100 −𝑃
𝑅 𝑛
=𝑃 1 + 100 −1
 4. Interest

4.2. Compound Interest

Derivation of Compound Interest Formula

Let's consider the following:
• Principal amount = 𝑃
• Time = 𝑛 years
• Rate = 𝑅
After 1st year,
𝑃×𝑅×𝑇
• Simple interest (𝑆𝐼1 ) =
100

• Amount = 𝑃 + 𝑆𝐼1
𝑃×𝑅×𝑇
= 𝑃 + 100
𝑅
= 𝑃 1 + 100
= 𝑃2

After 2nd year,

𝑃2 ×𝑅×𝑇
• Simple interest (𝑆𝐼2 ) =
100

• Amount = 𝑃2 + 𝑆𝐼2
𝑃2 ×𝑅×𝑇
= 𝑃2 + 100
𝑅
= 𝑃2 1 + 100
𝑅 𝑅
= 𝑃 1 + 100 1 + 100
𝑅 2
=𝑃 1+ 100

Similarly, if we proceed further to 𝑛 years, we can get:

𝑹 𝒏
Amount = 𝑷 𝟏 +
𝟏𝟎𝟎
 4. Interest

4.3. Simple Interest versus

Compound Interest
In simple interest, the principal amount remains the same
every year.
For example, if simple interest is calculated at 10% per
annum on a principal amount of ₹100, then the interest at
the end of every year will be ₹10 and the principal remains
the same every year.

In compound interest, the interest for a particular year is

added to the principal amount and then the interest is
calculated on the new principal.
For example, if compound interest is calculated at 10% per
annum on a principal amount of ₹100 for 2 years, the
interest at the end of the first year will be ₹10 and the
amount will be ₹(100 + 10) = ₹110 which will be the
principal for the next year. For the second year the interest
will be ₹11 and the amount will be ₹(110 + 11) = ₹121
which will be the principal for the next year.

Simple Interest Compound Interest

Principal 100 100

1st Interest at 10
year
10
10%
Amount 110 110

Principal 100 110

2nd
year Interest at 10 11
10%
Amount 120 121
 4. Interest

4.4. Conversion Period

If the rate of interest annually is 𝑅% and time period is 𝑛

years, then:
𝑅
• for half yearly interest, compounded rate is and time
2
period is 2𝑛.
𝑅
• for quarterly interest, compounded rate is and time
4
period is 4𝑛.
𝑅
• for monthly interest, compounded rate is and time
12
period is 12𝑛.

The table shows the general form of rate of interest for the
different conversion periods.

Interest Rate of interest

Time period (𝑛)
compounded (𝑅)

Annually 𝑅 𝑛

𝑅
Half - yearly 2𝑛
2

𝑅
Quarterly 4𝑛
4
𝑅
Monthly 12𝑛
12
 4. Interest

4.5. Application of
Compound Interest Formula
There are some situations where we could use the
compound interest formula.
Here are a few examples:
• Increase (or decrease) in population.
• The growth of a bacteria if the rate of growth is
known.
• The value of an item, if its price increases or
decreases in the intermediate years.

Growth

n
R
Final value = Present value × 1+
100

Depreciation

n
R
Final value = Present value × 1−
100

Growth/Depreciation rate = R% per annum

Time = n years
 Important Questions

Question 1 3 marks

In an examination, there are three papers each of

100 marks. A candidate obtained 53 marks in the
first paper and 75 marks in the second paper. How
many marks must the candidate obtain in the third
paper to get an overall of 70% marks?

Solution

Let 𝑥 be the marks of the candidate in the third paper.

Then, total marks secured in all three papers
= 53 + 75 + 𝑥 0.5 mark

Total marks of three papers = 100 + 100 + 100

= 300
Total marks secured
∴ Percentage of marks = × 100%
Total marks
53+75+𝑥 0.5 mark
= × 100%
300

But it is given that, he obtained overall of 70% marks.

53+75+𝑥
∴ × 100 = 70
300
128+𝑥
⇒ 3 = 70
⇒ 128 + 𝑥 = 210
⇒ 𝑥 = 210 − 128
∴ 𝑥 = 82
Hence, he must secure 82 marks in the third paper to get an
overall of 70% marks. 2 marks
 Important Questions

Question 2 4 marks

In 1975, the consumption of water for human use

was about 3850 cu km/yr. It increased to about
6000 cu km/yr in the year 2000. Find the percent
increase in the consumption of water from 1975 to
2000. Also, find the annual percent increase in
consumption (assuming water consumption
increases uniformly).

Solution
The consumption of water for human in 1975
= 3850 cu km/yr
The consumption of water for human in 2000
= 6000 cu km/yr
Increase in consumption of water in 1975 to 2000
= 6000 − 3850
= 2150 cu km/yr
2150
In percentage = × 100 = 55.84% 2 marks
3850

In 25 years, total increase in water consumption

= 2150 cu km/yr
Therefore, annually, i.e., per year consumption
2150
= = 86 cu km/yr
25
[∵ 2000 − 1975 = 25 years]
86
In percentage = × 100
3850
8600
= = 2.23% 2 marks
3850
 Important Questions
Question 3 3 marks

Prachi bought medicines from a medical store as

prescribed by her doctor for ₹36.40 including 4%
VAT. Find the price of medicines before VAT was
added.

Solution

The cost of medicine including 4% VAT = ₹36.40

We need to find the price of medicine before 4% VAT
Selling price = Cost price + VAT 1 mark
4
Cost price = 36.40 − × 36.40
100
= 36.40 − 4 × 0.364
= 36.40 − 1.456
= ₹ 34.944
≈ ₹ 35 2 marks

Question 4 2 marks

Arun bought a pair of skates at a sale where the

discount given was 20%. If the amount he pays is
₹1,600, find the marked price.

Solution

S.P. = ₹1,600 and Rate of discount = 20%

Let M.P. be ₹100 then S.P. for customer = ₹100 − ₹20 = ₹80
∴ When S.P. is ₹80, then M.P. = ₹100
100
∴ When S.P. is ₹1, then M.P. =
80
100
∴ When S.P. is ₹1,600, then M.P. = × 1,600 = ₹2,000
80
2 marks
 Important Questions

Question 5 4 marks

A shopkeeper was selling all his items at 25%

discount. During the off-season, he offered 30%
discount over and above the existing discount. If
Pragya bought a skirt which was marked for ₹1200,
how much did she pay for it?

Solution

Marked price of the skirt = ₹ 1200

25
Initial discount offered = × 1200
100
= 25 × 12
= ₹300

Price of the skirt after discount = ₹1200 − ₹300

= ₹900 2 marks

During off season,

30
Finial discount offered = × 900
100
= ₹270

Price of skirt after 30% discount = ₹900 − ₹270

= ₹630
So, Pragya paid ₹630 for the skirt.
2 marks
 Important Questions

Question 6 3 marks

I bought 100 laptops ₹20,000 each and had it

transported to my retail store for ₹75,000. What is
my selling price per laptop if I make a profit of
5%?

Solution

Cost Price = ₹20,000 × 100 = ₹20,00,000

Overhead charges = ₹75,000

0.5 mark

(Profit %)
Profit = × (Overhead + C.P.)
100

5
Profit = × 20,75,000 = ₹103750 0.5 mark
100

Total Selling Price = C.P. + Overhead charges + Profit

= 20,75,000 + ₹103750
= 21,78,750

Total Selling Price

Selling price per laptop =
100
₹2178750
= 100
= ₹21787.5 2 marks
 Important Questions

Question 7 3 marks

Find the amount to be paid at the end of 1 year on

₹1,800 at 8% per annum compounded quarterly.

Solution

We are given with rate of interest = 8% per annum

Principal amount = ₹1,800

Amount after 1 year when rate of interest is

𝑅 4×1
compounded quarterly = 𝑃 4
1 + 100 1 mark
8 4
= 1800 1 + 100 4

2 4
= 1800 1 + 100
102 4
= 1800 100
51 4
= 1800 50
= 1800 × 1.082
= 1947.6 2 marks
So, the amount to be paid at the end of 1 year on
₹1,800 at 8% per annum compounded quarterly is
₹1,947.6
 Important Questions

Question 8 2 marks

The value of a car, bought for ₹4,40,000 depreciates

each year by 10% of its value at the beginning of
that year. Find the value of the card after three
years.

Solution

The value of a car i.e., principal (𝑃) = ₹4,40,000

Rate of depreciation (𝑅%) = 10% per annum
Time period (𝑇) = 3 years
The value of the car after depreciation in 3 years is
given by

𝑇
𝑅 1 mark
𝐴=𝑃 1−
100
10 3
= 4,40,000 1−
100
9 9 9
= 4,40,000 × × ×
10 10 10
= 440 × 729
= ₹3,20,760 1 mark

So, the value of the car after 3 years is ₹3,20,760.