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If an organization were to sell n tickets for a theater

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If an organization were to sell n tickets for a theater

by AAPL » Wed Apr 11, 2018 5:01 am
If an organization were to sell n tickets for a theater production, the total revenue from ticket sales would be 20 percent greater than the total costs of the production. If the organization actually sold all but 5 percent of the n tickets, the total revenue from ticket sales was what percent greater than the total costs of the production?

A. 4%
B. 10%
C. 14%
D. 15%
E. 18%

The OA is C.

Let n = 100; Price of each ticket = 12
Cost = (Revenue)/1.2 = (100*12)/1.2 = 1000

Suppose the organization sold all but 5% of tickets i.e. 95 tickets, then revenue = 95*12

Percentage required = ((95*12 - 1000)/1000)*100 = (1140 - 1000)/10 = 14%. Option C.

Has anyone another strategic approach to solve this PS question? Regards!
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by [email protected] » Wed Apr 11, 2018 5:18 pm
Hi All,

We're told that if an organization were to sell N tickets for a theater production, then the total revenue from ticket sales would be 20 percent GREATER than the total costs of the production. We're asked if the organization actually sold all BUT 5 percent of the N tickets, then the total revenue from ticket sales would be what percent greater than the total costs of the production. This question can be solved by TESTing VALUES.

IF...
N=100 tickets
Product Cost = $1000
Revenue from ALL tickets sold = $1000 + (.2)($1000) = $1000 + $200 = $1200
1 ticket costs $1200/100 = $12

If we sold all but 5% of the tickets, then those 5 tickets would account for (5)($12) and the revenue in this case would be $1200 - $60 = $1140
Thus, this revenue would be ($1140 - $1000)/($1000) = 140/1000 = 14% greater than total costs.

Final Answer: C

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by GMATGuruNY » Wed Apr 11, 2018 6:59 pm
AAPL wrote:If an organization were to sell n tickets for a theater production, the total revenue from ticket sales would be 20 percent greater than the total costs of the production. If the organization actually sold all but 5 percent of the n tickets, the total revenue from ticket sales was what percent greater than the total costs of the production?

A. 4%
B. 10%
C. 14%
D. 15%
E. 18%
The number of tickets is irrelevant.
If 5% fewer tickets are sold, then the revenue decreases by 5%.

Let the cost of the production = 100.
If all the tickets are sold, the revenue is 20% more than the cost of the production:
100 + (20% of 100) = 100 + 20 = 120.
If 5% fewer tickets are sold, the revenue decreases by 5%:
120 - (5% of 120) = 120 - 6 = 114.
The resulting revenue in blue -- 114 -- is 14% greater than the $100 cost.

The correct answer is C.
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by Scott@TargetTestPrep » Thu Jul 05, 2018 3:52 pm
AAPL wrote:If an organization were to sell n tickets for a theater production, the total revenue from ticket sales would be 20 percent greater than the total costs of the production. If the organization actually sold all but 5 percent of the n tickets, the total revenue from ticket sales was what percent greater than the total costs of the production?

A. 4%
B. 10%
C. 14%
D. 15%
E. 18%
If we let c = the total cost of production, then 1.2c = the revenue from selling n tickets. Another way of saying this is that selling n tickets results in 1.2c. However, since the organization sold only 95% of the n tickets, the actual total revenue is 0.95(1.2c) = 1.14c.

Since the total revenue from selling 95% of the tickets is 1.14c, this means that the total revenue is 14% greater than the cost of production.

Answer: C

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