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MCQ

The Municipality of a town increases water tax by 20% and water consumption decreased by 20%. Then the percentage of increase or decrease in the monthly expenditure is:

#### Options

4% increase

4% decrease

5% increase

5% decrease

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#### Solution 1

The Municipality of a town increases water tax by 20% and water consumption decreased by 20%. Then the percentage of increase or decrease in the monthly expenditure is: **4% decrease**

#### Solution 2

**4% decrease**

**Explanation:**

Let initially rate of water tax was ₹ 100

By increasing the water tax rate by 20% per 1000 litre

then, water tax of 1000 litre = 120

Also, when consumption is reduced by 20%

new consumption`=1000xx80/100=800` litre

Now, water tax of 800 litres `=120/1000xx800=₹ 96`

Percentage decrease in expenditure

`=(100-96)/100xx100=4%`decrease

Concept: Percentage, Discount and Partnership (Entrance Exam)

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