Answer:
Let's see what we have here. A shopkeeper sold Item X for a his selling price (SP).
Let SP = x
Since the question says that Profit is 25% of the selling price, we have:
Profit = 25% SP = 0.25x
Now, we already know that:
Profit = SP - Cost
This part is the catch. To find out how much Item X originally cost,
Cost = SP - Profit = x - 0.25x = 0.75x
Now that we know the original cost of Item X, we can easily calculate the Real profit % using this formula:
= (Profit/Cost)*100
= (0.25x/0.75x)*100
= 33%
And there you have it. Hope I explained it clear enough.
