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Weighted Average Problem - Best way to approach?

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by katejohn7 » Sun Feb 28, 2010 11:53 am
I am hoping for some help with the best way to approach weighted average problems? I found this problem tricky. Thanks in advance.

"Each customer of a networking company subscribes to one of two plans: Plan A or Plan B. Plan A costs $75 per month per customer and Plan B costs $175 per month per customer. If the company's average revenue per customer per month is $100, then what percent of the Company's revenue comes from customers with Plan A?

A: 25%
B: 30%
C: 37.5%
D: 56.25%
E: 75%

OA: [spoiler]D
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by firdaus117 » Sun Feb 28, 2010 12:13 pm
let's cosider customers with plan "A" as a and customers with plan "B" as b.
now,Plan A costs $75 per month per customer.So,its effect is to reduce avarage by $25 per customer.Plan B costs $175 per month per customer. So,its effect is to increase avarage by $75 per customer.
If we add all these deviations,it would add up to zero.

-25a+75b=0
a=3b
[spoiler]percent of the Company's revenue comes from customers with Plan A={(Revenue from plan A)/Total revenue}*100
= 75 a/(75a+175b)*100
= (225b/400 b)*100
=56.25 %
Option D[/spoiler]
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by RJ43 » Mon Mar 01, 2010 12:58 pm
Not sure if this is the best way to do it, but:

A = Customers Plan A
B = Customers Plan B

75A + 175B/ A + B = 100

Solving for B we see that B = 1/3A, or 3 times as many A customers than B.

Plugging in 1 customer for B and 3 for A (1:3) we get:

75(3) + 175(1) / 3+1 = 100 = TRUE so:

Total revenue = 75(3) + 175(1) = 225 + 175 = 400

A's portion of 400 = 75 (3) = 225

225 / 400 = 56.25% D
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by STEVEN SPIELBERG » Mon Mar 15, 2010 11:02 am
IMOD
I want to win an OSCAR on the GMAT !!!
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