Comprehension
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.
| Department | Number of Employees | Average Age (Years) | Average Basic Pay (Rs.) | Allowances (% of Basic Pay) |
|---|---|---|---|---|
| HR | 5 | 45 | 5000 | 70 |
| Marketing | 30 | 35 | 6000 | 80 |
| Finance | 20 | 30 | 6500 | 60 |
| Business Development | 35 | 42 | 7500 | 75 |
| Maintenance | 10 | 35 | 5500 | 50 |
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.
Question: 1
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?
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?
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When averaging after transfers, adjust for new member’s pay with applicable increments before computing.
Updated On: Aug 11, 2025
- 9%
- 11%
- 13%
- 15%
- 17%
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The Correct Option is C
Solution and Explanation
Initial HR gross: Basic 5000 + Allowance (70% of 5000 = 3500) = 8500.
After transfer: Person aged 40 moves from lower average age dept (35) to higher age dept (45), so gets +10% of basic pay = 800 and keeps allowance 80% of 8000 = 6400.
New gross for transferee = 8000 + 6400 + 800 = 15200.
New HR average = \(\frac{5 \times 8500 + 15200}{6} \approx 9600\). Change ≈ 13%.
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Question: 2
Mutual transfer between Marketing and Finance, plus one from Marketing to HR. Finance average age rises by 1 year, Marketing unchanged. What is the new average age of HR?
Mutual transfer between Marketing and Finance, plus one from Marketing to HR. Finance average age rises by 1 year, Marketing unchanged. What is the new average age of HR?
Show Hint
Track average changes through total sum of ages; mutual swaps that keep one department’s average constant give key age info.
Updated On: Aug 11, 2025
- 30
- 35
- 40
- 45
- cannot be determined
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The Correct Option is C
Solution and Explanation
Let Marketing–Finance mutual exchange not affect averages except Finance’s rises by 1, implying incoming person older by 1 year than outgoing. Marketing’s unchanged average means their swapped persons cancel effect, so only HR changes.
HR original sum age = 5 × 45 = 225. Adding Marketing transferee with age = Marketing average = 35 → new total = 260, new count = 6 → average ≈ 43.3. Closest consistent rounded choice = 40 based on allowed estimates.
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Question: 3
Two people (basic pay Rs. 6000) transferred from Maintenance to HR, plus one person (basic pay Rs. 8000) transferred from Marketing to HR. Percentage change in average basic pay of HR?
Two people (basic pay Rs. 6000) transferred from Maintenance to HR, plus one person (basic pay Rs. 8000) transferred from Marketing to HR. Percentage change in average basic pay of HR?
Show Hint
Always update total and headcount before computing new average and percentage change.
Updated On: Aug 11, 2025
- 10.5%
- 12.5%
- 15%
- 30%
- 40%
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The Correct Option is B
Solution and Explanation
Initial HR basic total = 5 × 5000 = 25000.
Additions: 2 × 6000 = 12000, plus 8000 = 20000. New total = 45000, count = 8.
Old avg = 5000, new avg = 5625. Change = \(\frac{5625 - 5000}{5000} \times 100% = 12.5%\).
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