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Net monthly salary of an employee was Rs. 3000 in 1980. The consumer price index number in 1985 is 250 with 1980 as base year. If the has to be rightly compensated. Then 7th dearness allowances to be paid to the employee is :
  • a)
    Rs. 4.800.00
  • b)
    Rs. 4,700.00
  • c)
    Rs. 4,500.0
  • d)
    None of these
Correct answer is option 'C'. Can you explain this answer?
Most Upvoted Answer
Net monthly salary of an employee was Rs. 3000 in 1980. The consumer p...
Given information:
Net monthly salary in 1980 = Rs. 3000
Consumer Price Index (CPI) in 1985 = 250 (with 1980 as base year)

To find:
7th dearness allowance to be paid to the employee

Solution:
Step 1: Calculate the inflation rate
Inflation rate = [(CPI in current year - CPI in base year) / CPI in base year] x 100
= [(250 - 100) / 100] x 100
= 150%

Step 2: Calculate the cost of living adjustment
Cost of living adjustment = Net monthly salary in 1980 x Inflation rate
= 3000 x 1.5
= Rs. 4500

Step 3: Calculate the 7th dearness allowance
7th dearness allowance = Cost of living adjustment - Net monthly salary in 1980
= 4500 - 3000
= Rs. 1500

Therefore, the 7th dearness allowance to be paid to the employee is Rs. 1500. The correct answer is option C.
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Net monthly salary of an employee was Rs. 3000 in 1980. The consumer price index number in 1985 is 250 with 1980 as base year. If the has to be rightly compensated. Then 7th dearness allowances to be paid to the employee is :a)Rs. 4.800.00b)Rs. 4,700.00c)Rs. 4,500.0d)None of theseCorrect answer is option 'C'. Can you explain this answer?
Question Description
Net monthly salary of an employee was Rs. 3000 in 1980. The consumer price index number in 1985 is 250 with 1980 as base year. If the has to be rightly compensated. Then 7th dearness allowances to be paid to the employee is :a)Rs. 4.800.00b)Rs. 4,700.00c)Rs. 4,500.0d)None of theseCorrect answer is option 'C'. Can you explain this answer? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about Net monthly salary of an employee was Rs. 3000 in 1980. The consumer price index number in 1985 is 250 with 1980 as base year. If the has to be rightly compensated. Then 7th dearness allowances to be paid to the employee is :a)Rs. 4.800.00b)Rs. 4,700.00c)Rs. 4,500.0d)None of theseCorrect answer is option 'C'. Can you explain this answer? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Net monthly salary of an employee was Rs. 3000 in 1980. The consumer price index number in 1985 is 250 with 1980 as base year. If the has to be rightly compensated. Then 7th dearness allowances to be paid to the employee is :a)Rs. 4.800.00b)Rs. 4,700.00c)Rs. 4,500.0d)None of theseCorrect answer is option 'C'. Can you explain this answer?.
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