# GMAT Math Questions | Precentage Q5

###### GMAT Sample Questions | Percentage Increase Percentage Decrease GMAT Sample Questions

T he given question is a GMAT 600 level problem solving question in Percentages.The concept tested in this GMAT sample question is that of percentage increase in price leading to a corresponding percent decrease in quantity.

Question 5: If the price of gasoline increases by 25% and Ron intends to spend only 15% more on gasoline, by what % should he reduce the quantity of petrol that he buys?

1. 10%
2. 12.5%
3. 8%
4. 12%
5. 6.66%

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### Explanatory Answer | GMAT Percentage Q5

#### Step 1 of solving this GMAT Percentage Question: Assume values before price increase

The best way to solve questions that provide all information in percent terms is to assume something to be 100.
Amount spent on gasoline = Price × Quantity

In this case, let us take the initial price per unit of gasoline to be $100. Let Ron buy 1 unit of gasoline at this price. So, amount spent by Ron = 1 × 100 =$100

#### Step 2 of solving this GMAT Percentage Question: Find values after the price increase

Price increases by 25%.
Therefore, new price per unit = $100 + 25% of 100 =$125
Ron intends to increase the amount he spends on gasoline by only 15%.
Amount Ron is willing to spend on gasoline = $100 + 15% of 100 =$115.

#### Step 3 of solving this GMAT Percentage Question: Compute change in gasoline quantity due to price increase

Amount spent on gasoline = Price × Quantity
Let the new quantity of gasoline that he can get for \$115 be 'q'.
125 × q = 115
Or q = $$frac{115}{125}$ = $\frac{23}{25}$ Before the price increase, he was able to get 1 unit. Now, he will get only $\frac{23}{25}$ units. So, he gets$1- $$frac{23}{25}$) = $\frac{2}{25}$ units lesser after the price increase. Percentage reduction in quanity of gasoline he can buy = $\frac{\text{Decrease in quantity}}{\text{Initial quantity}}$ × 100 = $\frac{\frac{2}{5}}{1}$ × 100 = 8% Percentage reduction in gasoline consumption = 8% ##### Choice C is the correct answer. ###### GMAT Online Course - QuantTry it free! Register in 2 easy steps and Start learning in 5 minutes! ###### Already have an Account? ###### GMAT Live Online Classes Next Batch Dec 3, 2020 ###### GMAT Coaching in Chennai Next Integrated$Online + Offline) Batch
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