Question

If the price of a commodity is decreased by 20% and its consumption is increased by 10%, what will be the increase or decrease in the expenditure on the commodity?
A) increase 12%
B) decrease 12%
C) increase 16%
D) decrease 16%

Answer 1

Answer:

B) decrease 12%

Step-by-step explanation:

Take easy values.

Let price be 10 and consumption be 10.

Expenditure = 10x10 = 100

New price will be 8 and new consumption will be 11.

New expenditure will be = 8x11 = 88

So, % decrease = 12/100 x 100 = 12% decrease.