At Billy Bob Breweries, the revenues increased by 12%

Question

At Billy Bob Breweries, the revenues increased by 12% from 2002 to 2003 and the costs increased by 4% from 2002 to 2003. If Profit=Revenues-Costs, then what was the percentage change in profit at Billy Bob Breweries from 2002 to 2003?

1. The ratio of revenues to costs of Billy Bob Breweries in 2002 was 5:6

2. The revenues of Billy Bob Breweries in 2002 was 115 dollars and the costs of Billy Bob Breweries in 2002 was 138 dollars

stne · Answer

Aaha ! Found an untouched post !

1) there is clearly a loss as statement 1 says costs were more than the revenue 
in 2002 ,let the revenue be 5 and the cost be 6 then profit is -1 ( or rather loss)

in 2003 revenue is 1.12 *5 =5.60 and cost is 1.04*6 = 6.24 so profit is 5.60-6.24= -.64( or rather loss )

now we can see loss is less in 2003 (-.64) than in 2002 (-1) or the profit in 2003 is more than 2002
so change in profit %  \frac{-.64-(-1)}{-1}*100 =-36%  so it means there was an improvement of 36% in the loss of 2002.

take any other value of revenue and cost in 2002 based on the ratio, i.e. 10 and 12 and we will get the same percent change.
Sufficient

2) says the same thing as statement 1 , reduce by 23 to get R/C = 5/6 again sufficient.
Answer D

At Billy Bob Breweries, the revenues increased by 12%

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