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The price of a cycle is reduced by 25 per cent. The new price is reduced by a further 20 per cent. The two reductions together are equal to a single reduction of
45%
40%
50%
60%
Let the original price of the cycle be 100.
After the first reduction the price will be 75.
This new price is then reduced by 20% = 0.8 x 75 = 60
60 represents a reduction of 40 percent on the original.
Hence, option 2 is the correct answer.
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