Thank you for using the timer - this advanced tool can estimate your performance and suggest more practice questions. We have subscribed you to Daily Prep Questions via email.

Customized for You

we will pick new questions that match your level based on your Timer History

Track Your Progress

every week, we’ll send you an estimated GMAT score based on your performance

Practice Pays

we will pick new questions that match your level based on your Timer History

Not interested in getting valuable practice questions and articles delivered to your email? No problem, unsubscribe here.

Thank you for using the timer!
We noticed you are actually not timing your practice. Click the START button first next time you use the timer.
There are many benefits to timing your practice, including:

A company decreased the price of its main product by 50% [#permalink]
19 Nov 2011, 11:14

1

This post received KUDOS

1

This post was BOOKMARKED

00:00

A

B

C

D

E

Difficulty:

25% (medium)

Question Stats:

64% (01:47) correct
36% (01:01) wrong based on 170 sessions

A company decreased the price of its main product by 50%. Subsequently, the number of units sold increased such that the total revenue remained unchanged. What was the ratio of the percent increase in the units sold to the percent decrease of the original price for this product?

Re: a company decreased the price [#permalink]
19 Nov 2011, 11:33

1

This post received KUDOS

For the total revenue to remain the same when the price is halved, the number of products sold must double. Therefore increase in the number of products sold is 100%

Re: a company decreased the price [#permalink]
25 Mar 2012, 17:23

Price decreased so quantity must increase so the net effect of the 50% decrease and % increase in quantity must equal 1. And that is 200% increase. We are looking for the net % increase which is 100% increase and then take the ratio of that which is 100%/50% = 2. D _________________

Re: A company decreased the price of its main product by 50% [#permalink]
26 Mar 2012, 00:17

1

This post received KUDOS

Expert's post

manalq8 wrote:

A company decreased the price of its main product by 50%. Subsequently, the number of units sold increased such that the total revenue remained unchanged. What was the ratio of the percent increase in the units sold to the percent decrease of the original price for this product?

A. 0.5 B. 1.0 C. 1.5 D. 2.0 E. 4.0

Nice explanation above by GyanOne.

One can also use plug-in method: consider the price of the product to be $10 and the units sold at that price to be 1 --> revenue=$10*1=$10;

If we decrease the price by 50% from $10 to $5 then in order the revenue to remain the same 2 units must be sold which is 100% increase in sales (from 1 to 2).

Re: A company decreased the price of its main product by 50% [#permalink]
30 Dec 2012, 16:56

I used algebraical approach: 1) p1=p2 We know that p1q1=p2q2, let's apply here condition (1) ===> 2p2q1=p2q2. It means that 2q1=q2 or q2/q1=2 Manhattan CAT2 consider this question 700-800 which is not true. _________________

Re: A company decreased the price of its main product by 50% [#permalink]
18 Nov 2013, 05:53

I'm confused. Can someone please help me understand why the ratio is 100/50? I get that the quantity halved and the price doubled. But I don't get why the final ratio is a 2 instead of a 1.

Re: A company decreased the price of its main product by 50% [#permalink]
18 Nov 2013, 05:57

1

This post received KUDOS

Expert's post

sarahmichalmoore wrote:

I'm confused. Can someone please help me understand why the ratio is 100/50? I get that the quantity halved and the price doubled. But I don't get why the final ratio is a 2 instead of a 1.

Re: A company decreased the price of its main product by 50% [#permalink]
18 Nov 2013, 12:14

Bunuel wrote:

sarahmichalmoore wrote:

I'm confused. Can someone please help me understand why the ratio is 100/50? I get that the quantity halved and the price doubled. But I don't get why the final ratio is a 2 instead of a 1.