A man spends 65% of his income. His income increases by 20% and his expenditure also increases by 10%. The percentage of increase in his savings is ________.
Show answer & explanation
Correct answer: A
Explanation
The correct answer is option 1 i.e. 38.5%
As we know that
Income = Expenditure + Saving
Let Income is 100 units
According to the question
Expenditure = 65 units
Saving = 35 units
Now, Income is 120 units
and Expenditure = 65 × 1.1 units = 71.5 units
Savings = 120 - 71.5 = 48.5 units
The percentage of increase in his savings is = [(48.5 - 35)/35] × 100 = 38.5%