Maha Bazaar offers 20% discount on bags which have been marked 50% above the cost price. Amarnath pays Rs. 840 for a bag. Then the cost price of the bag is = ?

Answer: Option B

Let the cost price of bag is = 100 units
∴ Marked price of the bag = 150 units
Selling price of the bag :
$$\begin{array}{rl}& 150\times \frac{80}{100}=120\text{ units}\\ & \text{120 units = Rs. 840}\\ & \text{1 units = 7}\\ & \text{100 units = Rs. 700}\end{array}$$