A man spends 83% of his income. If his income increases by 23% and his expenditure increases by 13%, find the percentage increase in his savings.
Show answer & explanation
Correct answer: C
Explanation
Given:
Expenditure = 83% of Income ⇒ Savings = 17% of Income
According to the formula:
Percentage Increase = (New Savings − Old Savings) / Old Savings × 100
Assume Income = 100
Old Savings = 17
New Income = 123
New Expenditure = 83 × 1.13 = 93.79
New Savings = 123 − 93.79 = 29.21
Increase = 29.21 − 17 = 12.21
Percentage Increase = (12.21 / 17) × 100 = 71.82%