A milk man makes a profit of 10% on the sale of milk. If he were to add 20% water to the milk, by what would be the percentage increase in his profit?

A 300%

B 400%

C 220%

D 100%

E None of these

Correct Answer: Option C

Let initial quantity of pure milk = 100 litre

Suppose cost price of one litre of milk = Rs.1

Then his total cost price = Rs.100

total selling price = Rs.110

Profit = Rs. 10

∴ Selling price of 1 litre milk = Rs. 1.1

After mixing 20% water, quantity of the mixture = 120 litre

total selling price = 1.1 × 120 = Rs. 132

Profit = Rs. 32

Increase in Profit = 32 - 10 = 22

Percentage increase in profit \(= {\rm{\;}}\frac{{22}}{{10}}{\rm{\;}} \times 100{\rm{\;}} = {\rm{\;}}220{\rm{\% }}\)