Sunita's savings are equal to 18% of her expenditure. If her income increases…

Whenever one quantity is defined as a percentage of another — here, Savings is 18% of Expenditure, and Savings = Income − Expenditure — the fastest approach is to assign a convenient value (100) to the quantity the percentage is measured against, derive every other value from it, and then read off the required percentage change. Because the final answer is itself a percentage, the base value cancels out and does not affect the result; the cross-check below confirms this using a variable instead of a fixed number.

Applying this to the given figures:

1. Let Expenditure = 100, the base to which the 18% savings figure is anchored.

2. Savings = 18% of Expenditure = 18.

3. Income = Expenditure + Savings = 100 + 18 = 118.

4. New Income = Income × 1.35 (a 35% increase) = 118 × 1.35 = 159.3.

5. New Expenditure = Expenditure × 1.386 (a 38.6% increase) = 100 × 1.386 = 138.6.

6. New Savings = New Income − New Expenditure = 159.3 − 138.6 = 20.7.

7. Change in Savings = New Savings − Original Savings = 20.7 − 18 = 2.7.

8. Percentage Change = (Change / Original Savings) × 100 = (2.7 / 18) × 100 = 15%.

Cross-check with a variable, base-free method: let Expenditure = E, so Savings = 0.18E and Income = 1.18E. New Income = 1.18E × 1.35 = 1.593E and New Expenditure = E × 1.386 = 1.386E, so New Savings = 1.593E − 1.386E = 0.207E. Percentage change = (0.207E − 0.18E) / 0.18E × 100 = 15%. Because E cancels out, the result does not depend on the value assumed for Expenditure in Step 1 — confirming the answer and showing that any convenient base gives the same percentage.

Savings increase by 15%.