Question

These questions are based on the pie charts given below which gives the distribution or break-up of expenses incurred by Mr Patel for two consecutive years. We also know that his income in 2001 was 12 Lakhs and he got salary increment of 50% at the end of the year.

Q. If in 2003, Mr Patel’s salary increases by 20% compared to the previous year and his expenditures on entertainment and transportation increase by 25% each and all other expenditures remain the same as that in the previous year, then what is the percentage increase in his savings from 2002 to 2003?

• A. 75%
• B. 125%
• C. 175%
• D. 50%
• E. 150%

Answer 1

The correct option is E 150%

Mr Patel’s salary in 2003 = 1.20*18 Lakhs = 21.6 Lakhs
Mr Patel’s savings in 2002 was =$\frac{18}{360}\times 18Lakhs=90000$
His expenses were = 17.1 Lakhs
Increase in expenses = $\frac{25}{100}\times \frac{108+72}{360}\times 18Lakhs=2.25Lakhs$
Savings in 2003 = 21.6 - (17.1 Lakhs+2.25 Lakhs) = 2.25 Lakhs
% increase in savings = $\frac{2.25Lakh-0.9Lakh}{0.9Lakhs}\times 100=150\%$