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IAS Exam Question - Shopkeeper And Lady With Fake Note

A lady buys goods worth rs.200 from a shop. (shopkeeper selling the goods with zero profit).
The lady gives him 1000 rs note. The shopkeeper gets the change from the next shop and keeps 200 for himself and returns rs.800 to d lady.

Later the shopkeeper of the next shop comes with the 1000rs note saying "duplicate" and takes his money back.

"How much LOSS did the shopkeeper face ?"

A. 200
B. 800
C. 1200
D. 1800
E. 2000
F. 1600
G. 1000


Transaction 1 (Lady and Shopkeeper 1)

L--> S1  Rs. 1000fake
S1--> L Rs. 200 goods + Rs. 800 change

S1's loss:  Rs.200 goods+ Rs.800 change - Rs. 1000fake= Rs.1000

Transaction 2 (Shopkeeper 1 and Shopkeeper 2)

S1--> S2 1000fake; S2-->S1 1000change
S2-->S1  1000fake; S1-->S2 1000change

Point to be noted here is that Transaction 2 is a circular transaction and hence S1 does not face any loss from this transaction. He is simply returning the Rs.1000 he had borrowed from S2

So the only loss he has is from Transaction 1= Rs. 1000