Harsha's expenditure is 45% of her income. If the income from the next month is increased by 15% and the amount she saved each month remains the same, then find the percentage increased in her expenditure (rounded off to 2 decimal places).
Show answer & explanation
Correct answer: A
Explanation
The correct answer is option 1 i.e. 33.33%.
Let the initial income be I
Initial expenditure = 45% of I = 0.45I
Initial savings = S
Savings remain unchanged = S = I - 0.45I = 0.55I
New income(I') after a 15% increase:
⇒ I' = I + 0.15I = 1.15I
New expenditure(E')
⇒ E' = 1.15I - 0.55I = 0.60I
Thus,
Increase in expenditure = E' - E
⇒ 0.60I - 0.45I = 0.15I
Percentage increase = 0.15I/0.45I × 100
⇒ 0.15/0.45 × 100
⇒ 1/3 × 100 = 33.33%