IMO E

pradeepkaushal9518 wrote:guy's net income equals his gross income minus his deductions. by what percent did guy's net income change on January 1 1989 when both his gross income and his deductions increased?

1. guy's gross income increased by 4 % on January 1 1989.
2. guy's deduction increased by 15 % on January 1989

plz explain yr answer

NI = GI-D
GI and D increased on jan-1-1989

GI inc by 4%. so new GI = 1.04GI

We do not have any information about deductions.. So INSUFFICIENT

D inc by 15%
So new D = 1.15D

No information about GI. So INSUFFICIENT.

Combining both,

we get new NI = 1.04GI-1.15D

perc increase = (1.04GI-1.15D - (GI-D))/GI-D *100


Still we cannot calculate the increase.. So E


let me take an example.. let GI be 200, D be 100
NI = 200-100 = 100
new GI = 208, new D = 115
new NI = 93
perc change is 7

Suppose GI = 200 and D =50. then
NI = 150
new GI = 208
new D = 57.5
new NI = nearly 150
perc change is nearly zero

So we cannot say for sure the percentage change..

Hope this helps!!

Original Net income NIO=GI-D

Percent change=(Altered Net Income-Original Net Income)*100/Original Net Income

From stmt2
GI=GI+.04=1.04GI

We dont know abt deductions change,Insufficient

D=D+.15D=1.15D

We dont know abt Gross Income change,Insufficient

Combining,

Altered Net income NIA=1.04GI-1.15D

Percent change=(Altered Net Income-Original Net Income)*100/Original Net Income

(1.04GI-1.15D-GI+D)*100/(GI-D)

4GI-15D/(GI-D)

Unless we know the values of GI and D,we cant determine the % change.

Hence E