Profit and Loss – Average cost per call comparison with tiered telephony pricing: BSNL charges a fixed ₹ 350 per month and allows 200 calls free. Calls beyond 200 in a month cost ₹ 1.4 each; beyond 400 in a month cost ₹ 1.6 each, and so on. A customer makes 150 calls in February and 250 calls in March. By what percentage is the average cost per call in March cheaper than in February?

Introduction / Context:
With tiered pricing and a fixed rental, the most reliable way to compare months is to compute average cost per call for each month, then find the percentage reduction. February is entirely within the free allowance, while March incurs a small number of paid calls above 200.

Given Data / Assumptions:

• Fixed monthly rental = ₹ 350
• First 200 calls are free
• Rate beyond 200 and up to 400 = ₹ 1.4 per call
• February calls = 150; March calls = 250

Concept / Approach:
Average cost per call = Total bill / Total calls in that month. Compute separately for February and March using the step tariff, then compute the percentage difference relative to February’s average.

Step-by-Step Solution:
February: All 150 calls within free allowance ⇒ Bill = ₹ 350 ⇒ Avg = 350/150 ≈ ₹ 2.333...March: 250 calls ⇒ 50 paid at ₹ 1.4 ⇒ Bill = 350 + 50*1.4 = 350 + 70 = ₹ 420Avg March = 420/250 = ₹ 1.68Percent cheaper = (2.333... − 1.68) / 2.333... * 100 = 28%

Verification / Alternative check:
Using exact fractions: Feb avg = 7/3; Mar avg = 42/25; Reduction fraction = ((7/3) − (42/25)) / (7/3) = 28% exactly.

Why Other Options Are Wrong:
25% and 18.5% underestimate the reduction; 22% is not supported; “none of these” is false because 28% is exact.

Common Pitfalls:
Comparing total bills rather than average cost per call; forgetting March’s 50 paid calls.

Final Answer:
28%