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Directions for following three questions: Answer the following questions based on the information given below: There are 100 employees in an organization across five departments. The following table gives the department-wise distribution of average age, average basic pay and allowances. The gross pay of an employee is the sum of his/her basic pay and allowances.
There are limited numbers of employees considered for transfer/promotion across departments Whenever a person is transferred/promoted from a department of lower average age to a department of higher average age, he/she will get an additional allowance of 10% of basic pay over and above his/her current allowance. There will not be any change in pay structure if a person is transferred/promoted from a department with higher average age to a department with lower average age.
Questions below are independent of each other.
What is the approximate percentage change in the average gross of the HR department due to transfer of a 40-year old person with basic pay of Rs. 8000 from the Marketing department?
Man's new gross income = 8000 + (8000*0.8) + (8000*0.1) = 15200
Average gross income of HR = 5000 + (5000*0.7) = 8500
New average = $$\frac{8500*5 + 15200}{6}$$ = 9616
% increase = $$\frac{1116}{8500}*100$$ = 13.12% => 13% approximately.
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