The price of raw materials in a company has gone up by 20%. Also, the labour cost has increased to
1/4th of the total cost of production which was earlier 1/6th of the total cost of production. By how
much percent should the company reduce its usage of raw materials to keep the total cost of pr…

Question

The price of raw materials in a company has gone up by 20%. Also, the labour cost has increased to 
1/4th of the total cost of production which was earlier 1/6th of the total cost of production. By how 
much percent should the company reduce its usage of raw materials to keep the total cost of production 
same as before?

Jatin Patil · Answer

Let price of raw material 100
And new price 120(+20%)

1/6 of 100 =16.66
1/4 of 120= 30

Reduction=(30-16.66/30)*100 =25%

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