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Please ! Help me

by sunsun2z16 » Sun Sep 18, 2016 12:29 pm
From 2003 to 2004 the profits made by a company increased by 10%. A year later in 2005, the profits of this company decreased to their 2003 value. By what percent did the profits decrease from 2004 to 2005? 

A) 10 
B) 5 
C) 1 
D) 20 
E) 9

The answer is 9 and I really don't understand how to solve that..Please help me in detail solutions..Thanks you guys so much
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by Brent@GMATPrepNow » Sun Sep 18, 2016 2:04 pm
sunsun2z16 wrote:From 2003 to 2004 the profits made by a company increased by 10%. A year later in 2005, the profits of this company decreased to their 2003 value. By what percent did the profits decrease from 2004 to 2005? 

A) 10 
B) 5 
C) 1 
D) 20 
E) 9
Let's test some values.
Let's say the 2003 profits are $100
After a 10% increase, the 2004 profits are $110
In 2005, the profits are back to $100

So, we're going from $110 to $100

Percent decrease = 100(change)/original value
= 100(110- 100)/110
= (100)(10)/110
≈ 9.1%

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by MartyMurray » Mon Sep 19, 2016 5:14 am
To better understand this percent change concept, consider the following example.

2003: 100

2004: 200 (up 100% from 2003)

2005: 100 (Notice, returning from 200 to 100 did not require a 100% decrease. 200 to 100 is a 50% decrease.)

Here's another

1991: 1000

1992: 1250 (up 250/1000 or 25%)

1993: 1000 (down 250/1250 or 1/5 or 20%)

So you always have to consider the change and the number at the beginning.

Now let's consider your question.
From 2003 to 2004 the profits made by a company increased by 10%. A year later, in 2005, the profits of this company decreased to their 2003 value. By what percent did the profits decrease from 2004 to 2005?

A) 10
B) 5
C) 1
D) 20
E) 9
2003: x

2004: 1.10x (up 10%)

2005: x (down .10x/1.10x or 1/11, which is approximately .09 or 9%)

The correct answer is E.
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by MBA Challengers » Mon Sep 19, 2016 8:51 am
Percentage is a very relative concept, depending on the base. The percentage of 10 on a base of 100 changes to the percentage of 10 on a base of 200.
In practical terms, if you are 1 person on a deserted island, you are 100% of the population. Whereas if you are 1 person in a bigger city like Hakuna Matata with a population of 100, you will be 1% of the population.
That is the main concept tested in this question. In short, what is 10% of 100 when reversed. 10% of 100 makes it 100 + (10/100)*100 = 100 + 10 = 110.
Now when it reverts back to the value of 100, the change %age will be (10/110)*100 = ~9.1%
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by [email protected] » Mon Sep 19, 2016 9:36 am
Hi sunsun2z16,

It looks like each of the explanations has properly explained the 'math' behind this question (and how to TEST VALUES to quickly get to the correct answer), so I won't rehash any of that here. Instead, I'm going to point out the relative importance of knowing all of the necessary formulas and math rules that you'll be expected to use on Test Day. Here, the concept is "percent change", which is a rather important formula in the realm of business - and you'll be asked to use it at least once on the Official GMAT. That formula can be defined in a couple of different ways:

Percent Change = (New - Old)/Old = (Difference)/Original

The key to using this formula is make sure that you clearly define the 'old' value and the 'new' value. As long as you do that, then the calculations involved are almost always fairly straight-forward.

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by sunsun2z16 » Mon Sep 19, 2016 3:04 pm
Tks everyone so much..I don't think I have a lot of answers like that..And I'm so appreciate if you guys can help me in other questions I will post at this page, tks again ^^
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