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Senior Manager
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The Museum of Modern art in city X face financial [#permalink]
 01 Apr 2004, 08:24
Question Stats:
0% (00:00) correct
100% (00:00) wrong based on 0 sessions
The Museum of Modern art in city X face financial
difficulties. In order to solve these difficulties the admission
charge was increased by 20 percent. As a result, the museum's revenue
increased by 25 percent.
Which of the following could be properly inferred from the passage?
a. The increase in the admission charge coincided with an
increase in the museum expenses.
b. The increase in the admission charge coincided with a
decrease in the museum expenses.
c. The museum invested some of its income in improving its
facilities.
d. The increase in the admission charge coincided with an
increase in the number of visitors.
e. The increase in the admission charge coincided with a
decrease in the number of visitors.
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Director
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I think D is the best answer, but it can only be properly inferred if we know that admission charges are the only source of revenue for the museum.
Also, I'm not sure that the GMAT requires its takers to know what "revenue" is. Many people (erroneously) think that revenue and profit are the same thing. If a person thinks that these are identical, B becomes an attractive answer.
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Senior Manager
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Betweeb B & D.............I pick B!!
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Manager
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It is between B and D.....I think revenues mean total after all expenses and income...Right???then it must be D....
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GMAT Club Legend
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Agree with the confusion. "Revenues" seems equivalent to "profits" in this case since only B stands out as a possible answer. If B is not right, I would rather disqualify all answer as contenders because D goes a too long way assuming that ticket sales is the ONLY source of revenue (often times, museums receive mucho in donations and they may derive other income from endowment funds  ).
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Best Regards,
Paul
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Director
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Would back my instinct n choose B...
Vivek.
_________________
"Start By Doing What Is Necessary ,Then What Is Possible & Suddenly You Will Realise That You Are Doing The Impossible"
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Manager
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Good point on GMAT and Revenue. Id go with B on this one. No matter how many visitors come in 1 or a million, revenue still only goes up 20%, Has to be a decrese in something else.
_________________
---------------------------------------------------
The more I learn, the more I realize I know nothing!
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Senior Manager
Joined: 19 Feb 2004
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yes D is right
D: which is the only logical link for revenue increase as more
visitors visited the museum. B is wrong because Expenses reduced implies profits increase which is not stated in the Stimulus.
rgds,
batli
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SVP
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There is a suttle difference between B and D.
Since the Museum is already facing difficulties it probably cut down its expenses as much as possible. Hence there is no room to reduce the expenses further. This will rule out B vs D.
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