wishalsp333 wrote:
The price of raw materials has gone up by 15%, labour cost has also increased from 25% of the cost of raw material to 30% of the cost of raw material. By how much percentage should there be a reduction in the usage of raw materials so as to keep the cost same?
A. 30%
B. 24%
C. 28%
D. 25%
E. 17%
Let the initial quantity be n and the initial cost be c, so labour charges = 0.25c.... Total cost = c+0.25c=1.25c
The changed price = 1.15c and therefore, the labour price = 0.30*1.15c..... Total cost = 1.15c+0.3*1.15c=1.15c*(1+0.3)=1.15c*1.3 = 1.495 c or 1.5c
Let the changed quantity be r..
the total money spent has to be the same, so \(1.25c*n=1.5c*r.......\frac{r}{n}=\frac{1.25}{1.5}=[
fraction]125/100[/fraction]\)..
r as a % of n = \(\frac{125}{150}*100=\frac{250}{3}=83\)%
Thus reduction is 100-83=17%
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