If the increase in the percentage of the consumption of a commodity is 25% so that
overall budget does not change, then the price of the commodity falls by:
Show answer & explanation
Correct answer: C
Explanation
The correct answer is option 3 i.e. 
Increased in price of goods = 25%
Expenditure = Rate(Consumption)
If the expenditure remains same then rate is inversely proportional to consumption.
Let original price be 4 units.
When price is increased by 25% -
New price = 4 + 25% of 4 = 5 units
Original consumption = 5 units
New consumption = 4 units
Percentage decrease in the consumption = [(5 - 4)/5] × 100 = 20%