Correct Answer - Option 4 : 52% increase
Given:
Man spends 75% of his income.
Income increases by 28%
Expenditure increases by 20%
Concept:
Saving = Income – Expenditure
Solution:
Let the Income of a man = 100
Expenditure = 75% of 100
⇒ (75/100) × 100 = 75
Saving = Income – Expenditure
Initial Saving = 100 – 75 = 25 ----(1)
Now as per the question,
His income increased by 28%
⇒ His new income = Old income + 28% of Old income
⇒ His new income = (128/100) × 100 = 128
Similarly, his expenditure increased by 20%
⇒ His new expenditure = (120/100) × 75
⇒ His new expenditure = 90
Saving(new) = Income(new) – Expenditure(new)
⇒ Saving(new) = 128 - 90 = 38 ----(2)
Now, % increase in savings = {(38 – 25)/25} × 100 ----(from 1 and 2)
⇒ 13 × 4 = 52%
∴ The % increase in saving is 52%