Question

Due to increase in the price of mangoes by 10%, its consumption is decreased by 10 %. Then fnd the increase or decrease in the expenditure over mangoes. a) No change b) 1 % increase Lc 1 % decrease d) 10 % decrease
With explanation.​

Answer 1

Answer:

no change ofc

10% and 10% equalised

Answer 2

Given:

Increase in price of mangoes=10%

Decrease in consumption of mangoes=10%

To find:

The increase/ decrease in the expenditure on mangoes

Solution:

The decrease in the expenditure on mangoes is 1%. (Option c)

We can find the decrease by following the process given below-

We know that the expenditure incurred on mangoes is the product of the price and consumption of mangoes.

Let us assume that the price of mango is Rs.10 and the consumption of mango is 100 units.

The original expenditure on mangoes=Price×consumption

=10×100=Rs.1,000

Now, there is a 10% increase in the price of mango.

So, the new price of mango=Rs.10+10% of 10

=10+1=Rs.11

Similarly, there is a 10% decrease in the consumption of mangoes.

So, the new consumption becomes=100-10% of 100

=100-10=90 units

The new expenditure on mangoes=new price×new consumption

=11×90=Rs.990

The change in expenditure can be calculated as follows-

=(Original expenditure-New expenditure)/Original expenditure×100

On putting the values, we get

=(1000-990)/1000×100

=10/10

=1%

Therefore, the decrease in the expenditure on mangoes is 1%.