The savings of a man is equal to 20% of his expenditure. If his income increases by 25% and expenditure increases by 18%, then his saving will increase by:
Show answer & explanation
Correct answer: A
Explanation
The correct answer is option 1 i.e.60%.
Let the income and expenditure be 100x and 100y respectively.
Now, savings = 20% of 100y = 20y
Also, 20y = 100x - 100y
⇒ 5x = 6y
New income = 125x
New expenditure = 118y
New savings = 125x - 118y
⇒ 150y - 118y = 32y
Required percentage = (12y/20y) × 100 = 60%