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26 Jul 2018, 00:41
00:00

Difficulty:

75% (hard)

Question Stats:

41% (02:37) correct 59% (02:38) wrong based on 56 sessions

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A newly-opened retail store made $400 profit on the initial expenditure of$25000, and then made $1200 profit on the next$80000 expenditure. By approximately what percent did the ratio of profit to expenditure change from the first $25000 expenditure to the next$80000 expenditure?

A. 6.67% decrease
B. 6.25% decrease
C. 0
D. 6.25% increase
E. 6.67% increase

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26 Jul 2018, 01:08
1
EgmatQuantExpert wrote:
A newly-opened retail store made $400 profit on the initial expenditure of$25000, and then made $1200 profit on the next$80000 expenditure. By approximately what percent did the ratio of profit to expenditure change from the first $25000 expenditure to the next$80000 expenditure?

A. 6.67% decrease
B. 6.25% decrease
C. 0
D. 6.25% increase
E. 6.67% increase

Another way
let's see the profit on say 5000$400 on 25000 so $$\frac{400}{5}=80$$ in 5000 1200 on 80000 so $$\frac{1200}{(8*2)}=75$$ in 5000 so profit decreased from 80 to 75, so change = $$\frac{(80-75)}{80}*100=\frac{500}{80}$$=6.25% B _________________ 1) Absolute modulus : http://gmatclub.com/forum/absolute-modulus-a-better-understanding-210849.html#p1622372 2)Combination of similar and dissimilar things : http://gmatclub.com/forum/topic215915.html 3) effects of arithmetic operations : https://gmatclub.com/forum/effects-of-arithmetic-operations-on-fractions-269413.html GMAT online Tutor Intern Joined: 28 Jun 2018 Posts: 5 Re: A newly-opened retail store made$400 profit on the initial exp  [#permalink]

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27 Jul 2018, 01:50
Hi vaibhav1221 ...can you explain what exactly you've done?

Why haven't we just taken the differences of 2/125 and 200/3 and divided that by 2/125? Isn't that how you see percent change?
Manager
Joined: 19 Nov 2017
Posts: 148
Location: India
Schools: ISB
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GPA: 4

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30 Jul 2018, 05:57
3

Solution

Given:
• A newly-opened retail store made $400 profit on the initial expenditure of$25000, and then made $1200 profit on the next$80000 expenditure

To find:
• By approximately what percent did the ratio of profit to expenditure change from the first $25000 expenditure to the next$80000 expenditure

Approach and Working:
When the expenditure is $25000, the profit is$400

Maintaining the same ratio, we can say,
• When the expenditure is $80000, the profit should be $$\frac{400}{25000} * 80000$$ =$1280

However, on $80000 expenditure, the store is making a profit of$1200 only
• Therefore, the percentage decrease in profit = $$\frac{1280 – 1200}{1280} * 100$$ = 6.25%

Hence, the correct answer is option B.

_________________

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Success Stories
Guillermo's Success Story | Carrie's Success Story

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Articles and Question to reach Q51 | Question of the week

Number Properties – Even Odd | LCM GCD
Word Problems – Percentage 1 | Percentage 2 | Time and Work 1 | Time and Work 2 | Time, Speed and Distance 1 | Time, Speed and Distance 2
Advanced Topics- Permutation and Combination 1 | Permutation and Combination 2 | Permutation and Combination 3 | Probability
Geometry- Triangles 1 | Triangles 2 | Triangles 3 | Common Mistakes in Geometry
Algebra- Wavy line

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Number Properties 1 | Number Properties 2 | Algebra 1 | Geometry | Prime Numbers | Absolute value equations | Sets

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