Question

Due to global recession starting in January, Ram's monthly salary of Rs 8000 was cut by 10%. The monthly expenses, which were Rs 6000, increased at the rate of 5% per month. Since which month will he have no savings if the recession lasted for a year ?

• A. April
• B. March
• C. May
• D. June

Answer 1

The correct option is A April

Ram's salary in January = 8,000 - 10% of 8,000 = 7,200

Savings in January

= 7,200 - (6,000 x 1.05)

= 7,200-6,300

= 900

Savings in February

= 7,200 - (6,300 x 1.05 )

= 7,200 - 6,615

= 585

Savings in March

= 7,200 - (6,615 x 1.05)

= 7,200-6,945.75

= 254.25

Savings in April = 7,200 - (6,945.75 x 1.05)

= 7,200 - 7,293.03

= NIL

There are no savings in the month of April as the expenses are more than the income.