Question

The cost of food accounted for 25% of the
income of a particular family. If the income
gets raised by 20%, then what should be
the percentage decrease in the food
expenditure as a percentage of the total
income to keep the food expenditure
unchanged between the two years?

Answer 1

Let the current income = x
Food expenditure = 25/100 x or 0.25x

New income = 120/100 x = 1.2x

New percentage of food expenditure = 0.25x/1.2x  x 100 = 20.83%

So, the food expenditure should be decreased by 25 - 20.83 = 4.17%