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Let the C.P. be Rs.100 Then,S.P.=C.P.*(100+Profit%)/100=100*126/100=Rs.126 Let the Marked Price be Rs.x Discount=10% of x=x/10 S.P.=M.P.-Discount=x-x/10 =9x/10 But S.P. is also equal to Rs.126 According to the sum, 9x/10=126 or,x=126*10/9=140 therefore,M.P.=Rs.140 He has marked the item Rs.40 above C.P. Percentage increase=Increase/C.P.*100 =40/100*100=40% Ans:The M.P. is above the C.P. by 40%(In other words, The trader marked the item 40% above the C.P.)