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klaud Just gettin' started!
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percentage Wed Mar 14, 2012 5:37 am
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• Lap #[LAPCOUNT] ([LAPTIME])
In 1985 a company sold a brand of shoes to retailers for a fixed price per pair. In 1986 the number of pairs of the shoes that the company sold to retailers decreased by 20 percent, while the price per pair increased by 20 percent. If the company’s revenue from the sale of the shoes in 1986 was \$3.0 million, what was the approximate revenue from the sale of the shoes in 1985?

I tried to solve it in this way:

Price: 1000 dollars
Quantity: 3000 pieces

3000x1000=3.000.000

0,80(3000)x 1,2(1000)= 2400x1200=2.880.000

But the answer is 3.1 million.

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Anurag@Gurome GMAT Instructor
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Wed Mar 14, 2012 6:27 am
klaud wrote:
In 1985 a company sold a brand of shoes to retailers for a fixed price per pair. In 1986 the number of pairs of the shoes that the company sold to retailers decreased by 20 percent, while the price per pair increased by 20 percent. If the company’s revenue from the sale of the shoes in 1986 was \$3.0 million, what was the approximate revenue from the sale of the shoes in 1985?

I tried to solve it in this way:

Price: 1000 dollars
Quantity: 3000 pieces

3000x1000=3.000.000

0,80(3000)x 1,2(1000)= 2400x1200=2.880.000

But the answer is 3.1 million.
Let R be the rate per pair and N be the number of pairs in 1985.
So, rate per pair = R + 0.20 R = 1.2R
In 1986, number of pairs = N - 0.20N = 0.8N
Revenue in 1985 is N * R = NR
Revenue in 1986 is (0.8N)*(1.2R) = 0.96NR
Given that 0.96NR = 3
So, NR = 3/0.96 = 3 * 100/96 = 25/8 = 3.1 million

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