Question

Directions for questions 35 to 40: Study the following details about a family's monthly income and expenditure and answer the question that follows.

Income	Amount / Rate
Basic salary	Rs. 5,000
Petrol allowance	20% of basic salary
PF deduction	10% of basic salary

Expenditure	Share of net income
Food	28%
House rent	22%
Entertainment	12%
Children's Education	25%
Other expenses	13%

If the family gets a 15% inflation allowance on the basic salary, then what is the gross income of the family?

• A. Rs. 6150
• B. Rs. 6250
• C. Rs. 6750
• D. Rs. 7000

Hint:

Add the inflation allowance, a percentage of the basic salary, to the earlier gross income.

Answer 1

The Correct Option is C

Step 1: Understanding the Question.
We are asked for the new gross income once a 15 percent inflation allowance is added on top of the basic salary.

Step 2: Key Formula or Approach.
Start from the original gross income (basic salary plus petrol allowance) and add the new inflation allowance, which is a percentage of the basic salary.

Step 3: Detailed Explanation.
The original gross income is \[ 5000 + 0.20 \times 5000 = 6000 \]
The inflation allowance is 15 percent of the basic salary: \[ 0.15 \times 5000 = 750 \]
Adding this allowance to the earlier gross income gives the new gross income: \[ 6000 + 750 = 6750 \]

Step 4: Final Answer.
The gross income of the family becomes Rs. 6,750, so option (c) is correct. \[ \boxed{Rs.\ 6750} \]