The poverty line in Dinanagar is set at Rs.100 per capital per day. Five hundred people live in Dinanagar of whom 50 earn Rs.30 per capita per day and another 25 earn Rs.80 per capita per day each. Everybody else earns more than Rs.100 per day per capita. What is the minimum amount that the government of Dinanagar will have to spend to completely eradicate poverty?

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Rs.3000

Rs.3500

Rs.4000

Rs.4500

answer is C.

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Detailed Solution

Concept- Find the total amount the government must spend first on the people with Rs30 per capita per day to make them reach Rs.100 per capita per day and then on the people with Rs.80 per capita per day to eradicate poverty. In this question, first determine the total number of people out of 500 who earn less than Rs. per capita per day, which is (50 + 25) people. This will make it easier to approach the issue.
Dinanagar's poverty line is established at Rs. 100 per person, per day.
It is now assumed that dinanagar is home to 500 people.
where 25 people each make Rs. 80 per capita per day and 50 people each make Rs. 30 per capita per day.
The remaining population makes more than Rs. 100 per person each day.
Therefore, out of 500 persons, (50 + 25) = 75 people earn less than Rs. per capita per day.
The amount that the dinanagari administration must spend at a minimum in order to alleviate poverty must now be determined.
Therefore, the government will have to spend (100 - 30) = 70 on each individual to end poverty on 50 people who earn Rs. 30 per capita per day eradicate poverty ⇒50×70+25×20
Now simplify this we have,
⇒3500+500=4000
So, the government will have to spend Rs. 4000 to completely eradicate poverty.
Hence, the correct answer is 3) Rs. 4000

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