When the price of sugar is raised by 20%, a person increases their expenditure on sugar only by 12%. By what percentage (correct up to two decimal places) should he reduce his consumption of sugar so as to be able to maintain the same level of expenditure?
Show answer & explanation
Correct answer: B
Explanation
The correct answer is Option 2 i.e. 6.67%.
Original price = 100/kg and Consumption = 100 kg
Original expenditure = 100 × 100 = 10000
New price = 120/kg and New expenditure = 11200
New consumption = 11200/120
Reduction = 100 - 11200/120 = 20/3 = 6.67%