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Percentage (Expenditure Constant)
If the price of petrol is increased by 20%, by what percentage should the consumption be decreased by the consumer if the expenditure on petrol remains unchanged?
Explanation and memory cue
If the price increases by 20%, to keep expenditure constant, consumption must decrease so that (1 + price increase) × (1 - consumption decrease) = 1. Solving, consumption decrease = 20/120 = 1/6 = 16 2/3%.