kaps786 wrote:Can some experts help solve this in 2 MIN or less. I found timing to be an issue on this one. Please help explain approach you would use.


A clothing store's revenue last May was 6% less than its revenue last April. The store's revenue last May was greater than its expenses last May, and the stores revenue last April was greater than its expenses last April. Was the stores gross profit last May less than its gross profit last April?

1. The stores revenue last May was 2,400 less than its revenue last April

2. The stores expenses last May were 4% less than its expenses last April


OA is B

Gross Profit = Total Revenue - Total Expenses

Whenever the revenue is greater than the expenses, there is profit. Hence the store was in profit in both the months mentioned. We have to answer

Is (Total Revenue - Total Expenses) last May < (Total Revenue - Total Expenses) last April?

(1) If the stores revenue last May was 2,400 less than its revenue last April, then 2,400 must be 6 percent of its revenue last April. By this statement alone, we can find the revenues in the two months, but in the absence of the expenses in the two months, we cannot answer the main question. Insufficient

(2) If E were the expenses last April, then 0.96 E were the expenses last May. Also, from stem, if R were the revenue last April, then 0.94 R were the revenue last May.

That way, Gross Profit last May = 0.94 R - 0.96 E, whereas Gross Profit last April = R - E. Now see if we can answer, is 0.94 R - 0.96 E < R - E, and I'd say YES! Because, if greater fraction of E is subtracted from relatively smaller fraction of R, the result is going to be less than R - E. [spoiler]Sufficient

Pick B[/spoiler]