4meonly wrote:Guys, I still do not understand the logic of E.
Can somebody help me?

Income = pension + children give them.

So, pension increases 20%. But remember as per statement E, children give them only so much that they can live comfortably. This logic is same before and after.

Lets use some numbers. Lets say previously pension was 100 and to live comfortably they need 120 bux. So children would give them 20 bux.

120 = 100+20

Since inflation is same. They would need now, 120 bux to live comfortably. This figure does not change before and after since inflation did not cause any cost rise.

So, their new income for comfortable living is same but the pension rises to 20% in our example = 20 bux. But this time the children will not give them anything because 120 bux is enough to keep them living comfortably. As an equation,

120 = 120 + 0.

Hope this helps!!

Ye, thanx, I finally got the ligic of this answer!!!!

To shorten the logic, pension simply replaced children's help!

Wow, I fell for the trap and picked D as well. I like this question.

So do we have to "assume" that once their pension increased the children will not give them any more money? Isn't that an assumption that we just made up ourselves . . . shouldn't "E" say the children "supplemented"?

D is the most suitable option in this case