Problem Solving

Each customer of a networking company subscribes to one of two plans: Plan A or Plan B. Plan A costs $75 per month 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?
25%
30%
37.5%
56.25%
75%

IMO E is the correct answer.

abhirup1711 wrote:Each customer of a networking company subscribes to one of two plans: Plan A or Plan B. Plan A costs $75 per month 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?
25%
30%
37.5%
56.25%
75%

An alternate approach is to plug in the answers, which represent the percent of revenue from Plan A.
Let the monthly revenue = 10,000.
Since the average revenue per customer = 100, the total number of customers = sum/average = 10,000/100 = 100.

Answer choice C: 37.5% from Plan A
Total revenue from A = $3750
Total revenue from B = $6250.
Number of customers for A = 3750/75 = 50.
Number of customers for B = 6250/175 ≈ 35.
Total customers = 50+35 = 85.
Too few.
Eliminate C.

To increase the total number of customers required to yield $10,000 in monthly revenue, the number of customers purchasing the less expensive plan -- Plan A -- must INCREASE.
Thus, a HIGHER percentage of the total revenue must come from Plan A.
The value in E is easier to evaluate.

Answer choice E: 75% from Plan A
Total revenue from A = $7500.
Total revenue from B = $2500.
Number of customers for A = 7500/75 = 100.
Here, the total number of customers will EXCEED 100.
Eliminate E.

The correct answer is D.

Thanks for pointing out this mistake.