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 Question from a student: A man spends 80% of his income. His income increases by 40% and his expenditure also increases by 25%. Find the percentage increase in his savings?

Hi,

Suppose that man's income is $x$ units. He spends 80% of his income and saves 20%, thus he spends $0.8 \times x$ units and saves $0.2 \times x$ units. His income increases by 40% and thus his new income is

$X = 0.4 \times x = 1.4 \times x \mbox{ units.}$

Can you complete the problem now? If you need more assistance tell us what you did and we will try to help.

Penny

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