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**Introduction**

Line Graph is the innovative version of Bar Graph representation. If we connect the upper point of the first Bar to the upper point of the second Bar and then tie these dots, we will get a line. Repeating the procedure gives us the Line Graph representation. Line graph and bar grapg r easy to comprehend. A Line Graph looks like this:

__Sample Question__

*Following line graph shows the ratio of expenditure to income of three companies A, B and C during the period 2008–2013.*

Reading the headings are important otherwise you will not be able to understand what these lines are all about.

**Along Y-Axis are the ratios. Along X-Axis are the years. In between are the lines.**

*Following Line Graph shows the ratio of expenditure to income of three companies A, B and C.*

**Learn a few things from the heading:**

- For Company A in 2008, if Expenditure is Rs 0.9, then Income will be Rs 1, and so on.
- It’s
**Expenditure to Income**Ratio expressed as**E:I**and not Income to Expenditure. - To have Profit, Expenditure is to be less than Income. Reverse is for Loss.
- Profit and Loss percentages are calculated using the formulas for the same.
**Profit**= Income – Expenditure**Profit Percentage**= [Profit/Expenditure]*100**Loss**= Expenditure – Income**Loss Percentage**= [Loss/Expenditure]*100

- The lower is the E:I ratio, higher is the profit.

The questions of Expenditure and Income seem difficult to solve. But, let’s apply the above mentioned points to solve the questions in no time!

__Steps to Solve__

** Question 1:** In which of the following years is the percentage loss/profit of Company C the maximum?

**[1]** 2008**[2]** 2009**[3]** 2010**[4]** 2011**[5]** 2012

From point no. 5, we conclude that **profit is maximum when E:I is minimum** which is 0.3 in 2011.

Hence answer is [4].

** Question 2:** If the expenditure of Company A in 2008 and 2009 together is Rs 60 lakhs, then what is its income in 2008 and 2009 together?

**[1]** Rs 120 lakhs**[2]** Rs 150 lakhs**[3]** Rs 66.66 lakhs**[4]** Data inadequate**[5]** None of these

E:I for Company A in 2008 and 2009 is 0.5 and 0.4. This means for Rs 0.5 Expenditure in 2008, Income is Rs 1 in 2008 and for Rs 0.4 Expenditure in 2009, Income is Rs 1 in 2009. But combined Expenditure of 60 lakhs is given. **So, ratios being different, it’s not possible to calculate the Income from the combined expenditure.** Answer is [4].

** Question 3:** If the expenditure of Company B in 2008 and 2012 together is Rs 60 lakhs then what is its income in 2008 and 2012 together?

**[1]** Rs 66.66 lakhs**[2]** Rs 75 lakhs**[3]** Rs 48 lakhs**[4]** 96 Rs lakhs**[5]** Data inadequate

E:I for 2008 and 2012 is 0.8 and 0.8. **Ratios being same, combined Income from the combined Expenditure can be calculated. **Income = E/0.8 = 60/0.8 = 75 lakhs.

Answer is [2].

** Question 4:** In which of the years does Company C gain 100% profit?

**[1]** 2008**[2]** 2009**[3]** 2010**[4]** 2011**[5]** None of these

**For 100% profit, E:I ratio must be 0.5** so that I = E/0.5 = 2E. It’s in 2009.

Answer is [2]

** Question 5:** What is the percentage decrease in the percentage profit of Company C from 2009 to 2010?

**[1]** 75%**[2]** 300%**[3]** 62.5%**[4]** 160%**[5]** None of these

E:I of Company C in 2009 = 0.5:1

Profit = 1-0.5 = 0.5

Percentage profit of profit of Company C in 2009 =[0.5/0.5]*100 = 100%

E:I of Company C in 2010 = 0.8:1

Profit = 1-0.8 = 0.2

Percentage profit of profit of Company C in 2009 =[0.2/0.8]*100 = 25%

Percentage decrease = 75%.

Answer is [1].

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