In 1994, Company X recorded profits that were 10% greater than in 1993, and in 1993 the company's profits were 20% greater than they were in 1992. What were the company's profits in 1992?
(1) In 1994, the company's profits were $100,000 greater than in 1993.
(2) For every $3.00 in profits earned in 1992, Company X earned $3.96 in 1994.
Let 1992 = 100.
Since 1993 is 20% greater than 1992, 1993 = 100 + .2(100) = 120.
Since 1994 is 10% greater than 1993, 1994 = 120 + .1(120) = 132.
Thus:
1994 : 1993 : 1992 = 132 : 120 : 100.
Given this ratio, if we know the profit in any of the 3 years -- or the DIFFERENCE between any two years -- we can determine the profit in EACH of the 3 years (and thus the profit in 1992).
Statement 1: In 1994, the company's profits were $100,000 greater than in 1993.
SUFFICIENT.
Statement 2: For every $3.00 in profits earned in 1992, Company X earned $3.96 in 1994.
In other words:
1994 : 1992 = 396 : 300 = 132 : 100.
This statement only confirms the ratio given in the question stem.
INSUFFICIENT.
The correct answer is
A.
Private tutor exclusively for the GMAT and GRE, with over 20 years of experience.
Followed here and elsewhere by over 1900 test-takers.
I have worked with students based in the US, Australia, Taiwan, China, Tajikistan, Kuwait, Saudi Arabia -- a long list of countries.
My students have been admitted to HBS, CBS, Tuck, Yale, Stern, Fuqua -- a long list of top programs.
As a tutor, I don't simply teach you how I would approach problems.
I unlock the best way for YOU to solve problems.
For more information, please email me (Mitch Hunt) at
[email protected].
Student Review #1
Student Review #2
Student Review #3
