The income tax in the area where the Jones family lives is scheduled to increase by 12% next year. Since the Jones family cannot afford an increase in their tax bill, how much will they have to reduce income by to keep their cost the same? Select
A) 10.7% B) 10% C) 10.3% D) 10.9% E) 10.2%
Solution: Let the current tax be represented by Rs. 100.   The tax rate rises 12%. So, to continue to have the same income, they need to increase their tax,   = (100 + 12% of 100) = Rs. 112.   But, they want to keep tax expense the same, so they have to cut Rs. by 12 to keep it to Rs. =100.   The % decrease in income is,   (12/112)*100 = 10.7%.   Mental Calculation Method;   100-----12%↑---→112------X%↓---→100.   Here, X = (12/112)*100 = 10.7%.   10.7%nswer: Option 10.7%
<result>A</result>
The income tax in the area where the Jones family lives is scheduled to increase by 12% next year. Since the Jones family cannot afford an increase in their tax bill, how much will they have to reduce income by to keep their cost the same?