Marketing executives for a certain chewing gum company

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Gmat_mission: Legendary Member; Posts: 1622; Joined: Thu Mar 01, 2018 7:22 am; Followed by:2 members

Marketing executives for a certain chewing gum company

by Gmat_mission » Sat Nov 30, 2019 4:12 am

Marketing executives for a certain chewing gum company projected a 20 percent increase in revenue this year over that of last year, but revenue this year actually decreased by 25%. What percent of the projected revenue was the actual revenue?

A. 53%
B. 58%
C. 62.5%
D. 64%
E. 75%

[spoiler]OA=C[/spoiler]

Source: Veritas Prep

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Source: Beat The GMAT — Problem Solving | Sat Nov 30, 2019 4:12 am

GMAT/MBA Expert

[email protected]: Elite Legendary Member; Posts: 10392; Joined: Sun Jun 23, 2013 6:38 pm; Location: Palo Alto, CA; Thanked: 2867 times; Followed by:511 members; GMAT Score:800

by [email protected] » Mon Dec 02, 2019 10:11 am

Hi All,

We're told that marketing executives for a certain chewing gum company projected a 20 percent INCREASE in revenue this year over that of last year, but revenue this year actually DECREASED by 25%. We're asked what percent of the projected revenue was the actual revenue. This question can be solved in a couple of different ways, including by TESTing VALUES.

IF... last year's revenues were $100
then the PROJECTED revenues this year were $100 + (.2)($100) = $120
and the ACTUAL revenues this year were $100 - (.25)($100) = $75

The actual revenue, relative to the projected revenue, was $75/$120 = 15/24 = 5/8 = 62.5%

Final Answer: C

GMAT assassins aren't born, they're made,
Rich

Contact Rich at [email protected]

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Scott@TargetTestPrep: GMAT Instructor; Posts: 8086; Joined: Sat Apr 25, 2015 10:56 am; Location: Los Angeles, CA; Thanked: 43 times; Followed by:29 members

Re: Marketing executives for a certain chewing gum company

by Scott@TargetTestPrep » Mon Jan 13, 2020 2:49 pm

Gmat_mission wrote: ↑
Sat Nov 30, 2019 4:12 am
Marketing executives for a certain chewing gum company projected a 20 percent increase in revenue this year over that of last year, but revenue this year actually decreased by 25%. What percent of the projected revenue was the actual revenue?

A. 53%
B. 58%
C. 62.5%
D. 64%
E. 75%

[spoiler]OA=C[/spoiler]

Source: Veritas Prep

We can let revenue last year = 100.

Projected revenue was 1.2 x 100 = 120, and actual revenue was 100 x 0.75 = 75.

Thus, actual/projected = 75/120 = 25/40 = ⅝ = 62.5%.

Answer: C

Scott Woodbury-Stewart
Founder and CEO
[email protected]