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ExpertsGlobal5
Did Sanna save at least 20 percent higher last month than what she did the previous month?

(1) Sanna’s income last month was 20 percent greater than her income in the previous month.
(2) Sanna’s expenses last month were 10 percent greater than her expenses in the previous month.

Explanation:

Let Sanna’s savings in the previous month be S.
Sanna’s savings in the last month is unknown.
We need to find whether Sanna’s savings in the last month > 1.2S.

Statement (1)

Let Sanna’s income in the previous month be K.
Sanna’s income in the last month = 1.2K

It is NOT possible to determine relation between Sanna’s savings in the previous and the last month from the given information. Hence, Statement (1) is insufficient.

Statement (2)

Let Sanna’s expense in the previous month be E.
Sanna’s expense in the last month = 1.1E

It is NOT possible to determine relation between Sanna’s savings in the previous and the last month from the given information. Hence, Statement (2) is insufficient.

As Statement (1) alone as well as Statement (2) alone is insufficient to answer the question, we need to now combine the two statements.

Statement (1) and Statement (2) combined

Intuitively:
Since Sanna’s income increased by 20%, but the expense increased by less than 20%; hence, the saving increased by more than 20%.

Mathematically:
Sanna’s savings in the previous month (S) = Income in the previous month – Expense in the previous month = K – E
Sanna’s savings in the previous month with a 20% increase = 1.2S = 1.2K – 1.2E.
Sanna’s savings in the last month = Income in the last month – Expense in the last month = 1.2K – 1.1E

Since 1.2K – 1.1E > 1.2K – 1.2E for all positive values as K and E, it is possible to determine with certainty that Sanna saved at least 20 percent higher last month than what she did the previous month. Hence, Statement (1) and Statement (2) combined are sufficient.

C is the correct answer choice.
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