Kalyan spends 80% of his income. His income increases by 15% and his expenditure also increases by 5%. The percentage of increase in his savings is:
Show answer & explanation
Correct answer: C
Explanation
The correct answer is option 3 i.e. 55%.
Let the income of Kalyan = ₹100
Total spending of Kalyan = 80% of ₹100 = ₹80
Total saving of Kalyan = ₹100 - ₹80 = ₹20
Present income of Kalyan after 15% increase = ₹115
Present expenditure of Kalyan after 5% increase = 80 × (105/100) = ₹84
Present saving of Kalyan = ₹115 - ₹84 = ₹31
Total increase of savings = ₹31 - ₹20 = ₹11
The increase percentage = (Old Savings/New Savings) × 100%
= (11/20) × 100%
= 55%
Therefore, the percentage of increase in Kalyan's savings is 55%.