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A 25% pay raise for a officer is implemented. How much of the new pay should be cut in order to reinstate the old pay?

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10%

20%

30%

40%

answer is B.

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Detailed Solution

Given that, 25% pay raise for a officer is implemented.
Let the old pay be Rs ‘x’.
After a 25% pay raise, the new pay

= x + 25 % x

.
New pay is,

⇒ x + 25100 × x

⇒ x + 14 x

⇒ R s 54 x

(i)
Difference between old and new pay,

⇒ R s 54 x − x ⇒ R s 14 x

We know that,

D e c r e a s e i n % = D e c r e a s e i n q u a n t i t y o r i g i n a l q u a n t i t y × 100

⇒

Decrease in %,

⇒ 14 x 54 x × 100 ⇒ 20 %

Hence, option 2 is correct.

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