Question

1. The price of sugar is increased by 10%. By how much percent should a family
reduce the consumption, so as not to increase the expenditure.​

Answer 1

Step-by-step explanation:

If the prices of sugar increases by 10%, how much of a percentage must a family reduce its consumption, so that the family's expenditures do not increase?

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Hey,

You have got an interesting response from an economist point of view.

Below is my answer in mathematical terms.

Let the Expenditure of the family be denoted by [math]E[/math].

Let the initial price of the sugar [math]= P.[/math]

Let the initial consumption of sugar [math]= C.[/math]

[math]Expenditure (E) = Price * Consumption = P*C[/math] ————————-(1)

The price of the sugar is increased by 10%.

So the new price of sugar = [math]P[/math][math] + \dfrac{10}{100}P = P+0.1P = 1.1P[/math]

Let the new Consumption = C’

The expenditure (E’) after increase in the sugar price, and, decrease in the consumption = New Price * New Consumption[math] = 1.1P*C’[/math].——————-(2)

Expenditure before and aft

Control your blood sugar.

This generally happen only theoretically as the demand will come down by the elasticity of demand. Say if 1 % rise in price brings down demand by say 8%, then at the individual level one can see the demand coming down by 80% for 10% rise in price.

Nowadays, this predicament of forfeited consumption, delayed consumption are all reduced by cashless transactions using credit cards, where one can buy on credit and payoff later on in installments as the cashflow happens next month. or one can push forward ones payment stream for later periods, without tampering with ones consumption needs.

This now i

Let the initial price of Sugar is Rs. x and initial monthly consumption of sugar is y kg. So, monthly expenditure towards use of sugar is

x * y = Rs. xy

When sugar price increased by 10% then price of sugar will become 1.1 x. To maintain expenditure constant, Rs. xy to be fixed. Hence consumption of sugar to be reduced by 1 * 100/1.1 = 9.1 % Ans.