The ratio of income and expenditure is 6:5. Income increases by 40% and spending decreases by 20%. If the initial expenditure is ₹4,50,000. Find the final saving (in ₹).
Show answer & explanation
Correct answer: C
Explanation
The correct answer is option 3, i.e., 3,96,000.
Let initial income = 6x and initial expenditure = 5x
Given expenditure = ₹4,50,000 → 5x = 4,50,000 → x = 90,000
Initial income = 6x = 6 × 90,000 = 5,40,000
Income increases by 40% → new income = 5,40,000 × (100 + 40) ÷ 100 = 5,40,000 × 140 ÷ 100 = 7,56,000
Expenditure decreases by 20% → new expenditure = 4,50,000 × (100 − 20) ÷ 100 = 4,50,000 × 80 ÷ 100 = 3,60,000
Final saving = New income − New expenditure = 7,56,000 − 3,60,000 = 3,96,000