Discussion
Ram's salary was first reduced by 60%. Later on it was increased by 60%. His present salary is what percent. of initial salary ?
Answer: A
His present salary is 64% of the original.
Successive percentage changes multiply. Taking the initial salary as 100:
\[ \begin{aligned} 100 \times 0.4 &= 40 \\ 40 \times 1.6 &= 64 \end{aligned} \]
The trap is to think a 60% fall and a 60% rise cancel out. They do not, because the rise is 60% of the smaller, reduced salary. 60%, 62% and 68% do not come from this calculation.
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