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# Problem #163 of OG 12th edition

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Problem #163 of OG 12th edition [#permalink]

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21 Dec 2009, 20:26
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Can someone explain me in detail how to solve problem #163. I don't understand how the book came up with the solution: s/I?
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Joined: 30 Aug 2009
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Re: Problem #163 of OG 12th edition [#permalink]

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21 Dec 2009, 20:26
Mpaala wrote:
Can someone explain me in detail how to solve problem #163. I don't understand how the book came up with the solution: s/I?

let Henry's income be I, amount spent X and amount saved S
The amount next year Henry will have to spend is S(1+r)

we need to find S/I in terms of r
Now S(1+r) = 1/2 X ==> X = 2S(1+r) ====> I -S = 2S(1+r) ==> I = S [ 2(1+r) + 1]
==> I = S[ 3+ 2r] ==> S/I = 1/(3+ 2r)
Re: Problem #163 of OG 12th edition   [#permalink] 21 Dec 2009, 20:26
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