Successive price increase on petrol: The price of petrol is first increased by 20% and then again by 40%. If the original price was ₹25 per litre, what will be the final price per litre after both increases?

Introduction / Context:This percentage question checks understanding of successive percentage changes. When two increases are applied one after another, we must multiply the factors rather than add the percentages. The context is a fuel price update where the base price is known and two sequential hikes are announced.

Given Data / Assumptions:

• Original petrol price = ₹25 per litre.
• First increase = 20%.
• Second increase = 40% (applied after the first increase).

Concept / Approach:For an increase of r%, multiply the current value by (1 + r/100). Two increases r1% and r2% in succession yield a net factor (1 + r1/100) * (1 + r2/100). This multiplicative compounding is essential; adding 20% and 40% as 60% would be incorrect here.

Step-by-Step Solution:

Verification / Alternative check:Multiply once using combined factor: 25 * (1.20 * 1.40) = 25 * 1.68 = 42. This confirms the stepwise computation and highlights the compounding nature of successive percentage changes.

Why Other Options Are Wrong:₹45 and ₹48 come from misapplying or over-compounding the rates; ₹40 often appears when someone adds 20% and 40% as 60% and applies 25 * 1.60 = 40, which is wrong because the second increase is on the increased price, not the original price. ₹35 is unrelated to any correct approach.

Common Pitfalls:Adding percentages directly (20 + 40) without compounding. Forgetting that the second percentage acts on the updated price leads to systematic errors in retail and finance problems.

Final Answer:₹42