Question

The average expenditure of the hotel when there are 10 guests is Rs. 60 per guests and the average expenditure is Rs. 40 when there are 20 guests. If it is known that there are some fixed expenses irrespective of the number of guests then the average expenditure per guest when there are 40 gilests in the hotel :

• A. Rs. 30
• B. Rs. 25
• C. Rs. 20
• D. can't be determined

Answer 1

The correct option is A Rs. 30

Let the fixed expenditure of the hotel be Rs. x and the variable expenditure (which is dependent on the guest) is Rs. y, then
x + 10y = 600 . . . . (1)
x + 20y = 800 . . . . (2)
$\Rightarrow$ 10y = 200
x = 400 and y = 20
hence the total expenditure when there are 40 guests
= 400 + 40 $\times$ 20 = 1200
Therefore average expenditure $=\frac{1200}{40}=Rs.30$