If the price of petrol is increased by 25 percent, then how much should a person decrease the consumption to keep the expenditure same?
Show answer & explanation
Correct answer: D
Explanation
The correct answer is Option 4 i.e. 20 percent.
Concept used:
If the expenditure remains the same then,
Price is inversely proportional to consumption
Calculations:
Let the price of the petrol be 100x.
25% increase in the price = 125% of 100x = 125x
Now, to keep the expenditure remains same, the consumption decreases
⇒ Consumption before price increase = 125x
⇒ Consumption after price increase = 100x
Hence, required % decrease = [(125x - 100x)/125x] × 100
⇒ 20%