Question

A man spends 75% of his income. If his income increases by 20% and his expenditure increases by 10%, then the percentage of increase in his saving would be

• A. 40%
• B. 30%
• C. 50%
• D. 25%

Hint:

Always assume income = 100 for percentage problems — simplifies calculations.

Answer 1

The Correct Option is C

Concept: \[ \text{Savings} = \text{Income} - \text{Expenditure} \]

Step 1: Assume income.
Let income = 100 Expenditure = 75 Saving = 25

Step 2: Increase values.
New income: \[ 100 + 20% = 120 \] New expenditure: \[ 75 + 10% = 75 + 7.5 = 82.5 \]

Step 3: New saving.
\[ 120 - 82.5 = 37.5 \]

Step 4: Increase in saving.
\[ 37.5 - 25 = 12.5 \]

Step 5: Percentage increase.
\[ \frac{12.5}{25} \times 100 = 50% \]

Step 6: Final conclusion.
Thus, percentage increase in saving is: \[ 50% \]