The table shows the income (rupees lakh) and percentage profit of a company from 2017 to 2022.
| Year | Income | Profit (%) |
|---|---|---|
| 2017 | 120 | 7.5 |
| 2018 | 160 | 15 |
| 2019 | 130 | 22.5 |
| 2020 | 170 | 17.5 |
| 2021 | 190 | 20 |
| 2022 | 150 | 27.5 |
If the percentage profit in 2021 was 25% instead of 20%, then what would have been the expenditure in that year?
A130 lakh
B148 lakh
C120 lakh
D152 lakh ✓ Correct
Correct answer: (D) 152 lakh
Explanation
The expenditure would be about 152 lakh, so the answer is 152 lakh.
Income in 2021 is 190 lakh, which stays the same under this hypothesis.
With a profit of 25%, income equals expenditure times 1.25.
So 190 equals expenditure times 1.25.
Expenditure is therefore 190 divided by 1.25.
This works out to 152 lakh.
A higher profit rate on the same income means a lower expenditure, since more of the income is profit.
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