I started thinking about theories of what increases what, but maybe the best thing is to just use hard numbers here.

Let's say that the cost of X is actually 8 and the cost of Y is actually 15.

The smallest change we could make to satisfy Statement 1 is to make the selling price of Y 16 and leave the selling price of X at 8.

So the profit on Y would be 1 and the profit on X would be 0.

Beyond that, at any selling price for Y, the profit is always higher than that on X as we are basically always adding 2 to the price of Y for every 1 we add to the price of X.

This pattern would hold for any costs of X and Y in the ratio 8:15, basically because 15 is a little less than twice 8. So right from the start we need to add more to the cost of Y to get the selling price than we need to add to the cost of X.

I am not sure what Statement 2 is saying. Is it saying that there is another price that is marked on the toys but which is not the actual selling price?

Without a definition of the marked price, I am not sure how to finish this question.

I'm guessing that the marked price is what the seller WANTED to get and that the selling price is what he ACTUALLY GOT.

Under this assumption, the "marked price" of the toys is irrelevant, so the answer is A or E. Now let's work with S1.

X costs the merchant 8b and Y costs the merchant 15b.

X is sold for d and Y is sold for 2d.

We want to know if

Y Profit > X Profit, or

2d - 15b > d - 8b, or

d > 7b

As with some of the other terribly written and edited questions submitted by this user, there are Barber of Seville implications to the wording here. ("The profit on Y" seems to imply that such a profit exists, but there may have been no profit at all, in which case the problem is stated in impossible terms.)

But since profit implies a gain, I guess we have to assume given the prompt that d - 8b > 0 and 2d - 15b > 0. Therefore d > 8b and S1 is sufficient: d - 8b > 0 implies d > 8b -- and obviously b is positive, since it represents a price paid -- so d > 7b is true and the profit on Y is greater than the profit on X.