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A company sells two products, L and M. Last year, seventy

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by BTGmoderatorLU » Mon Oct 01, 2018 2:41 pm

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Source: GMAT Paper Tests

A company sells two products, L and M. Last year, seventy percent of the units sold were product L, and the price of product L was 25 percent greater than the price of product M. Approximately what percent of the total revenue the company received last year was from the sale of product L?

A. 15%
B. 25%
C. 35%
D. 65%
E. 74%

The OA is E.
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by fskilnik@GMATH » Mon Oct 01, 2018 2:59 pm
BTGmoderatorLU wrote:Source: GMAT Paper Tests

A company sells two products, L and M. Last year, seventy percent of the units sold were product L, and the price of product L was 25 percent greater than the price of product M. Approximately what percent of the total revenue the company received last year was from the sale of product L?

A. 15%
B. 25%
C. 35%
D. 65%
E. 74%
Let´s explore a "double particular case", choosing a suitable number of (total) units and a suitable unitary price (for product M)!
\[10\,\,{\text{units}}\,\,\,\left\{ \begin{gathered}
\,7\,\,{\text{units}}\,\,L\,\,\,\, \to \,\,\,\$ 5\,\,{\text{each}} \hfill \\
\,3\,\,{\text{units}}\,\,M\,\,\,\, \to \,\,\,\$ 4\,\,{\text{each}} \hfill \\
\end{gathered} \right.\]
\[? = \frac{{7 \cdot 5}}{{7 \cdot 5 + 3 \cdot 4}} = \frac{{35}}{{47}} = \underleftrightarrow {\frac{{35 \cdot 2}}{{47 \cdot 2}} = \frac{{70}}{{94}}} > 70\% \,\,\, \Rightarrow \,\,\,\left( E \right)\]

This solution follows the notations and rationale taught in the GMATH method.

Regards,
Fabio.
Fabio Skilnik :: GMATH method creator ( Math for the GMAT)
English-speakers :: https://www.gmath.net
Portuguese-speakers :: https://www.gmath.com.br
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by Scott@TargetTestPrep » Wed Oct 03, 2018 4:41 pm
BTGmoderatorLU wrote:Source: GMAT Paper Tests

A company sells two products, L and M. Last year, seventy percent of the units sold were product L, and the price of product L was 25 percent greater than the price of product M. Approximately what percent of the total revenue the company received last year was from the sale of product L?

A. 15%
B. 25%
C. 35%
D. 65%
E. 74%
We can let the number of units of L and M sold last year be 7 and 3, respectively. We can also let the unit prices of L and M be $5 and $4, respectively. We see that the revenue from product L is 7 x 5 = $35 and the total revenue is 35 + 3 x 4 = 35 + 12 = $47. Therefore, the revenue from product L is 35/47 ≈ 74% of the total revenue.

Alternate Solution:

If the prices of L and M were equal, then precisely 70% of the revenue would be from product L. Since the price of L is actually greater than price of M, more than 70% of the revenue will be from product L. The only answer choice greater than 70 is E.

Answer: E

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[email protected]

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