The monthly income of a person is ₹15,000. He saves 20% of his income. If his income increases by 10% and his nominal savings remains the same, then what will be his new expenditure?
Answer & explanation
Correct answer: option 3
20% = \(\frac{1}{5}\) & 10% = \(\frac{1}{10}\)
Income = 15000
saving = \(\frac{1}{5}\) × 15000 = 3000
Expenditure = 15000 - 3000 = 12000
Increased Income = 15000 + \(\frac{1}{10}\) × 15000 = 16500
Saving remains same
So, saving = 3000
New expenditure = 16500 - 3000 = 13500