The price of a pen is first increased by 40% and then decreased by 40%. What is the net change in its price?

💡 Solution & Explanation

Take the price as 100. After a 40% increase it becomes 140. A 40% decrease is taken on 140, which is 56, so the price becomes 84. That is 16 less than the start: a net decrease of 16%. Shortcut: an equal rise and fall of x% always gives a decrease of x²/100 %.