The Honda company reduces the number of its worker in the ratio 7 : 4 and increases their wages in the ratio 3 : 5 then find the ratio of the company's expenditure on total wages previously and now.
- AOption (a)
21 : 20
- BOption (b)
20 : 21
- COption (c)
4 : 5
- DOption (d)
5 : 4
- EOption (e)
None of these
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Correct answer
21 : 20
Why this answer is correct
Shortcut Trick
Ratio of number of workers = 7 : 4
Ratio of wages per worker = 3 : 5
Ratio of Total Expenditure = (7 × 3) : (4 × 5) = 21 : 20
∴ The correct answer is 21 : 20.
Alternate Method
Given:
Initial number of workers = 7x, New number of workers = 4x
Initial wages = 3y, New wages = 5y
Formula Used:
Total Expenditure = (Number of Workers) × (Wages per Worker)
Calculations:
⇒ Previous Expenditure = 7x × 3y = 21xy
⇒ Current Expenditure = 4x × 5y = 20xy
⇒ Ratio = 21xy : 20xy
⇒ Ratio = 21 : 20
∴ The correct answer is 21 : 20.
Additional Information
Compound Ratio
When two or more ratios are multiplied term by term, the resulting ratio is called a Compound Ratio. Here, (a:b) and (c:d) gives (ac:bd).
Expenditure Relation
In commercial arithmetic, Total Cost or Expenditure is always the product of Quantity (workers/items) and Rate (wages/price).
Inverse Variation
If the total expenditure remains constant, the number of workers would be inversely proportional to the wages per worker.

