Single correct option
The price of sugar rises by 25%. A household wants its monthly expenditure on sugar to rise by only 10%. By what percentage must it reduce its consumption of sugar?
- A. 10%
- B. 12%
- C. 13.5%
- D. 15%
Show answer and solution
Answer: (B) 12%
Expenditure = Price × Consumption. New expenditure factor = 1.10 and new price factor = 1.25, so the consumption factor = 1.10/1.25 = 0.88. Consumption must therefore fall by 12%.
Why not 15%? Simply subtracting 25% − 10% = 15% ignores that percentage changes multiply, they do not add.
Tip: Whenever a product (P × Q) is involved, work with multiplying factors, not with differences of percentages.
Why not 15%? Simply subtracting 25% − 10% = 15% ignores that percentage changes multiply, they do not add.
Tip: Whenever a product (P × Q) is involved, work with multiplying factors, not with differences of percentages.
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