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.

It appears that you are browsing the GMAT Club forum unregistered!

Signing up is free, quick, and confidential.
Join other 500,000 members and get the full benefits of GMAT Club

Registration gives you:

Tests

Take 11 tests and quizzes from GMAT Club and leading GMAT prep companies such as Manhattan GMAT,
Knewton, and others. All are free for GMAT Club members.

Applicant Stats

View detailed applicant stats such as GPA, GMAT score, work experience, location, application
status, and more

Books/Downloads

Download thousands of study notes,
question collections, GMAT Club’s
Grammar and Math books.
All are free!

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]

Show Tags

19 Nov 2011, 11:14

2

This post received KUDOS

3

This post was BOOKMARKED

00:00

A

B

C

D

E

Difficulty:

25% (medium)

Question Stats:

67% (01:00) correct
33% (00:55) wrong based on 288 sessions

HideShow timer Statistics

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?

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%

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
_________________

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]

Show Tags

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]

Show Tags

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.

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]

Show Tags

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.

Re: A company decreased the price of its main product by 50% [#permalink]

Show Tags

01 Oct 2016, 03:50

Hello from the GMAT Club BumpBot!

Thanks to another GMAT Club member, I have just discovered this valuable topic, yet it had no discussion for over a year. I am now bumping it up - doing my job. I think you may find it valuable (esp those replies with Kudos).

Want to see all other topics I dig out? Follow me (click follow button on profile). You will receive a summary of all topics I bump in your profile area as well as via email.
_________________

Happy New Year everyone! Before I get started on this post, and well, restarted on this blog in general, I wanted to mention something. For the past several months...

It’s quickly approaching two years since I last wrote anything on this blog. A lot has happened since then. When I last posted, I had just gotten back from...

Post-MBA I became very intrigued by how senior leaders navigated their career progression. It was also at this time that I realized I learned nothing about this during my...