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Read the following and answer the questions that follows.
In the island of Hoola Boola Moola, the inhabitants have a strange process of calculating their average incomes and expenditures. According to an old legend prevalent on that island, the average monthly income had to be calculated on the basis of 14 months in a calendar year while the average monthly expenditure was to be calculated on the basis of 9 months per year. This would lead to people having an underestimation of their savings since there would be an underestimation of the income and an overestimation of the expenditure per month.
In the island of Hoola Boola Moola, the inhabitants have a strange process of calculating their average incomes and expenditures. According to an old legend prevalent on that island, the average monthly income had to be calculated on the basis of 14 months in a calendar year while the average monthly expenditure was to be calculated on the basis of 9 months per year. This would lead to people having an underestimation of their savings since there would be an underestimation of the income and an overestimation of the expenditure per month.
If the minister for economic affairs decided to reverse the process of calculation of average income and average expenditure, what will happen to the estimated savings of a person living on Hoola Boola Moola island?
- a)It will increase
- b)It will decrease
- c)It will remain constant
- d)Will depend on the value
Correct answer is option 'A'. Can you explain this answer?
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Most Upvoted Answer
Read the following and answer the questions that follows.In the island...
Monthly estimates of income is reduced as the denominator
is increased from 12 to 14 at the same time the monthly estimate of expenditure is increased as the denominator is reduced from 12 to 9. Hence, the savings will be underestimated
is increased from 12 to 14 at the same time the monthly estimate of expenditure is increased as the denominator is reduced from 12 to 9. Hence, the savings will be underestimated
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Read the following and answer the questions that follows.In the island...
Solution:
To understand the impact of reversing the process of calculation of average income and average expenditure on the estimated savings of a person living on Hoola Boola Moola island, let's break down the given information and analyze it step by step.
Given information:
- Average monthly income is calculated based on 14 months in a calendar year.
- Average monthly expenditure is calculated based on 9 months per year.
- This leads to an underestimation of income and an overestimation of expenditure, resulting in an underestimation of savings.
Now, let's see what happens when the process of calculation is reversed.
Reversing the calculation:
- Average monthly income will now be calculated based on 9 months per year.
- Average monthly expenditure will now be calculated based on 14 months in a calendar year.
Impact on estimated savings:
1. Income: When the calculation of average income is based on 9 months per year, it will result in a lower average income compared to the previous method. This is because the average income will be calculated over a shorter period of time. Therefore, the estimated income will decrease.
2. Expenditure: When the calculation of average expenditure is based on 14 months in a calendar year, it will result in a higher average expenditure compared to the previous method. This is because the average expenditure will be calculated over a longer period of time. Therefore, the estimated expenditure will increase.
3. Savings: Savings are calculated by subtracting the average expenditure from the average income. Since the estimated income decreases and the estimated expenditure increases after reversing the calculation, the difference between the two will be larger. This means that the estimated savings will increase.
Therefore, the estimated savings of a person living on Hoola Boola Moola island will increase if the minister for economic affairs decides to reverse the process of calculation of average income and average expenditure.
Answer: Option A) It will increase.
To understand the impact of reversing the process of calculation of average income and average expenditure on the estimated savings of a person living on Hoola Boola Moola island, let's break down the given information and analyze it step by step.
Given information:
- Average monthly income is calculated based on 14 months in a calendar year.
- Average monthly expenditure is calculated based on 9 months per year.
- This leads to an underestimation of income and an overestimation of expenditure, resulting in an underestimation of savings.
Now, let's see what happens when the process of calculation is reversed.
Reversing the calculation:
- Average monthly income will now be calculated based on 9 months per year.
- Average monthly expenditure will now be calculated based on 14 months in a calendar year.
Impact on estimated savings:
1. Income: When the calculation of average income is based on 9 months per year, it will result in a lower average income compared to the previous method. This is because the average income will be calculated over a shorter period of time. Therefore, the estimated income will decrease.
2. Expenditure: When the calculation of average expenditure is based on 14 months in a calendar year, it will result in a higher average expenditure compared to the previous method. This is because the average expenditure will be calculated over a longer period of time. Therefore, the estimated expenditure will increase.
3. Savings: Savings are calculated by subtracting the average expenditure from the average income. Since the estimated income decreases and the estimated expenditure increases after reversing the calculation, the difference between the two will be larger. This means that the estimated savings will increase.
Therefore, the estimated savings of a person living on Hoola Boola Moola island will increase if the minister for economic affairs decides to reverse the process of calculation of average income and average expenditure.
Answer: Option A) It will increase.
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Read the following and answer the questions that follows.In the island of Hoola Boola Moola, the inhabitants have a strange process of calculating their average incomes and expenditures. According to an old legend prevalent on that island, the average monthly income had to becalculated on the basis of 14 months in a calendar year while the average monthly expenditure was to be calculated on the basis of 9 months per year. This would lead to people having an underestimation of their savings since there would be an underestimation of the income and an overestimation of the expenditure per month.If the minister for economic affairs decided to reverse the process of calculation of average income and average expenditure, what will happen to the estimated savings of a person living on Hoola Boola Moola island?a)It will increaseb)It will decreasec)It will remain constantd)Will depend on the valueCorrect answer is option 'A'. Can you explain this answer?
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Read the following and answer the questions that follows.In the island of Hoola Boola Moola, the inhabitants have a strange process of calculating their average incomes and expenditures. According to an old legend prevalent on that island, the average monthly income had to becalculated on the basis of 14 months in a calendar year while the average monthly expenditure was to be calculated on the basis of 9 months per year. This would lead to people having an underestimation of their savings since there would be an underestimation of the income and an overestimation of the expenditure per month.If the minister for economic affairs decided to reverse the process of calculation of average income and average expenditure, what will happen to the estimated savings of a person living on Hoola Boola Moola island?a)It will increaseb)It will decreasec)It will remain constantd)Will depend on the valueCorrect answer is option 'A'. Can you explain this answer? for CAT 2024 is part of CAT preparation. The Question and answers have been prepared according to the CAT exam syllabus. Information about Read the following and answer the questions that follows.In the island of Hoola Boola Moola, the inhabitants have a strange process of calculating their average incomes and expenditures. According to an old legend prevalent on that island, the average monthly income had to becalculated on the basis of 14 months in a calendar year while the average monthly expenditure was to be calculated on the basis of 9 months per year. This would lead to people having an underestimation of their savings since there would be an underestimation of the income and an overestimation of the expenditure per month.If the minister for economic affairs decided to reverse the process of calculation of average income and average expenditure, what will happen to the estimated savings of a person living on Hoola Boola Moola island?a)It will increaseb)It will decreasec)It will remain constantd)Will depend on the valueCorrect answer is option 'A'. Can you explain this answer? covers all topics & solutions for CAT 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Read the following and answer the questions that follows.In the island of Hoola Boola Moola, the inhabitants have a strange process of calculating their average incomes and expenditures. According to an old legend prevalent on that island, the average monthly income had to becalculated on the basis of 14 months in a calendar year while the average monthly expenditure was to be calculated on the basis of 9 months per year. This would lead to people having an underestimation of their savings since there would be an underestimation of the income and an overestimation of the expenditure per month.If the minister for economic affairs decided to reverse the process of calculation of average income and average expenditure, what will happen to the estimated savings of a person living on Hoola Boola Moola island?a)It will increaseb)It will decreasec)It will remain constantd)Will depend on the valueCorrect answer is option 'A'. Can you explain this answer?.
Read the following and answer the questions that follows.In the island of Hoola Boola Moola, the inhabitants have a strange process of calculating their average incomes and expenditures. According to an old legend prevalent on that island, the average monthly income had to becalculated on the basis of 14 months in a calendar year while the average monthly expenditure was to be calculated on the basis of 9 months per year. This would lead to people having an underestimation of their savings since there would be an underestimation of the income and an overestimation of the expenditure per month.If the minister for economic affairs decided to reverse the process of calculation of average income and average expenditure, what will happen to the estimated savings of a person living on Hoola Boola Moola island?a)It will increaseb)It will decreasec)It will remain constantd)Will depend on the valueCorrect answer is option 'A'. Can you explain this answer? for CAT 2024 is part of CAT preparation. The Question and answers have been prepared according to the CAT exam syllabus. Information about Read the following and answer the questions that follows.In the island of Hoola Boola Moola, the inhabitants have a strange process of calculating their average incomes and expenditures. According to an old legend prevalent on that island, the average monthly income had to becalculated on the basis of 14 months in a calendar year while the average monthly expenditure was to be calculated on the basis of 9 months per year. This would lead to people having an underestimation of their savings since there would be an underestimation of the income and an overestimation of the expenditure per month.If the minister for economic affairs decided to reverse the process of calculation of average income and average expenditure, what will happen to the estimated savings of a person living on Hoola Boola Moola island?a)It will increaseb)It will decreasec)It will remain constantd)Will depend on the valueCorrect answer is option 'A'. Can you explain this answer? covers all topics & solutions for CAT 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Read the following and answer the questions that follows.In the island of Hoola Boola Moola, the inhabitants have a strange process of calculating their average incomes and expenditures. According to an old legend prevalent on that island, the average monthly income had to becalculated on the basis of 14 months in a calendar year while the average monthly expenditure was to be calculated on the basis of 9 months per year. This would lead to people having an underestimation of their savings since there would be an underestimation of the income and an overestimation of the expenditure per month.If the minister for economic affairs decided to reverse the process of calculation of average income and average expenditure, what will happen to the estimated savings of a person living on Hoola Boola Moola island?a)It will increaseb)It will decreasec)It will remain constantd)Will depend on the valueCorrect answer is option 'A'. Can you explain this answer?.
Solutions for Read the following and answer the questions that follows.In the island of Hoola Boola Moola, the inhabitants have a strange process of calculating their average incomes and expenditures. According to an old legend prevalent on that island, the average monthly income had to becalculated on the basis of 14 months in a calendar year while the average monthly expenditure was to be calculated on the basis of 9 months per year. This would lead to people having an underestimation of their savings since there would be an underestimation of the income and an overestimation of the expenditure per month.If the minister for economic affairs decided to reverse the process of calculation of average income and average expenditure, what will happen to the estimated savings of a person living on Hoola Boola Moola island?a)It will increaseb)It will decreasec)It will remain constantd)Will depend on the valueCorrect answer is option 'A'. Can you explain this answer? in English & in Hindi are available as part of our courses for CAT.
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