The monthly income of a person was Rs 12,000 and his monthly expenditure was Rs 8,000. Next year, his income increased by 10% and his expenditure by 8%. Find the percentage increase in his savings.
Show answer & explanation
Correct answer: B
Explanation
The correct answer is option 2 i.e. 14%.
Savings = Income - Expenditure
Savings = Rs. 12000 - Rs. 8000 = Rs. 4000
Now, His income increased by 10% = 12000 × 110/100 = Rs. 13200
His Expenditure increased by 8% = 8000 × 108/100 = Rs. 8640
So, His new savings = 13200 - 8640 = Rs. 4560
Hence, his percentage increase of savings = [(4560 - 4000)/4000] × 100 = 560/40 = 14 %