What is the approximate percentage change in the average gross pay of the HR department due to transfer of a 40-yr old person with basic pay of Rs. 8000 from the Marketing department?
Answer: C
The average age of the Marketing department is 35 years and that of the HR department is 45 years. So, the employee is being transferred from a department with a lower average age to one with a higher average age, which means that he gets an additional allowance of 10% of basic pay over his current allowance.
His current allowance = 80% of 8000 = 6400
Therefore, his new allowance = 6400 + 10% of 8000 = 6400 + 800 = 7200
After the transfer, his gross pay = 8000 + 7200 = 15200
Initially, the average gross pay of the HR department = 5000 + 70% of 5000 = 8500
The new average gross pay of the HR department (i.e. after the transfer of the 40-yr old)
∴ The percentage change in the average gross pay of the HR department
× 100 ≈ 13.13%
Hence, option (c).