Question

    Price of rice is increased by 25%. Find the percentage by

    which consumption must be decreased so that expenditure on rice remains unchanged.
    A 20% Correct Answer Incorrect Answer
    B 18% Correct Answer Incorrect Answer
    C 12% Correct Answer Incorrect Answer
    D 25% Correct Answer Incorrect Answer

    Solution

    ATQ,

    Let the initial price and initial consumption of rice be Rs. '100m' per kg and 'n' kg respectively.

    Initial expenditure = 100m × n = Rs. '100mn'

    New price = 1.25 × 100m = Rs. '125m'

    New consumption = (100mn / 125m) = (100n / 125) kg

    Decrease in consumption = n - (100n / 125) = (25n / 125) kg

    Required percent = [(25n / 125) ÷ n] × 100 = (2500 / 125) = 20%

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