GMAT Question of the Day - Daily to your Mailbox; hard ones only

 It is currently 22 Nov 2019, 18:24 ### GMAT Club Daily Prep

#### 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

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.  # Company X's profits this year increased by 25% over last year's profit

Author Message
TAGS:

### Hide Tags

Math Expert V
Joined: 02 Sep 2009
Posts: 59268
Company X's profits this year increased by 25% over last year's profit  [#permalink]

### Show Tags

29 00:00

Difficulty:   35% (medium)

Question Stats: 69% (01:44) correct 31% (01:41) wrong based on 646 sessions

### HideShow timer Statistics

Company X's profits this year increased by 25% over last year's profits. Was the dollar amount of Company X's profits this year greater than the dollar amount of Company Y's?

(1) Last year, the ratio of Company Y's profits to Company X's profits was 5:2.
(2) Company Y experienced a 40% drop in profits from last year to this year.

NEW question from GMAT® Quantitative Review 2019

(DS14170)

_________________
Director  D
Status: Learning stage
Joined: 01 Oct 2017
Posts: 995
WE: Supply Chain Management (Energy and Utilities)
Company X's profits this year increased by 25% over last year's profit  [#permalink]

### Show Tags

3
1
Bunuel wrote:
Company X's profits this year increased by 25% over last year's profits. Was the dollar amount of Company X's profits this year greater than the dollar amount of Company Y's?

(1) Last year, the ratio of Company Y's profits to Company X's profits was 5:2.
(2) Company Y experienced a 40% drop in profits from last year to this year.

NEW question from GMAT® Quantitative Review 2019

(DS14170)

Let company X's profit last year be p and company Y's profit be 'q' last year.
Company X's profits this year increased by 25% over last year's profits.
So X's profit this year=1.25p.---------------(1)

Question stem:- $$profit_{X}>profit_{Y} ?$$ (This year)

St1:- Last year, the ratio of Company Y's profits to Company X's profits was 5:2.
Or,$$\frac{p}{q}=\frac{5}{2}$$ -----------------(2)
No data available on profit of company Y this year. So, we can't determine any relationship between profit of X and Y this year.
Insufficient.

St2:-Company Y experienced a 40% drop in profits from last year to this year.
So Y's profit this year=0.6q-------------(3)

from (1) and (3),This year, $$\frac{profit_{X}}{profit_{Y}}=\frac{1.25p}{0.6q}=\frac{1.25}{0.6}*(\frac{p}{q})$$--(4)
Since p and q are unknown. We can't determine the above relationship.
Hence, insufficient.

combining, from (2), we have the ratio of p/q . Hence we can substitute it in (4). Therefore, we can say which company has more profit this year.

Sufficient.

(C)
_________________
Regards,

PKN

Rise above the storm, you will find the sunshine
Intern  G
Joined: 18 Nov 2013
Posts: 45
Re: Company X's profits this year increased by 25% over last year's profit  [#permalink]

### Show Tags

PKN wrote:
Bunuel wrote:
Company X's profits this year increased by 25% over last year's profits. Was the dollar amount of Company X's profits this year greater than the dollar amount of Company Y's?

(1) Last year, the ratio of Company Y's profits to Company X's profits was 5:2.
(2) Company Y experienced a 40% drop in profits from last year to this year.

NEW question from GMAT® Quantitative Review 2019

(DS14170)

Let company X's profit last year be p and company Y's profit be 'q' last year.
Company X's profits this year increased by 25% over last year's profits.
So X's profit this year=1.25p.---------------(1)

Question stem:- $$profit_{X}>profit_{Y} ?$$ (This year)

St1:- Last year, the ratio of Company Y's profits to Company X's profits was 5:2.
Or,$$\frac{p}{q}=\frac{5}{2}$$ -----------------(2)
No data available on profit of company Y this year. So, we can't determine any relationship between profit of X and Y this year.
Insufficient.

St2:-Company Y experienced a 40% drop in profits from last year to this year.
So Y's profit this year=0.6q-------------(3)

from (1) and (3),This year, $$\frac{profit_{X}}{profit_{Y}}=\frac{1.25p}{0.6q}=\frac{1.25}{0.6}*(\frac{p}{q})$$--(4)
Since p and q are unknown. We can't determine the above relationship.
Hence, insufficient.

combining, from (2), we have the ratio of p/q . Hence we can substitute it in (4). Therefore, we can say which company has more profit this year.

Sufficient.

(C)

Why shouldn't it be A? Since the profit of Y/X is given as 5:2 and X profits increased by 25 %, doesn't it give a clue?

Let us say X's profit is 200 and Y's profit is 500; the x profit will never go above 500.
Manager  S
Joined: 06 Nov 2016
Posts: 58
Location: Viet Nam
GPA: 3.54
Re: Company X's profits this year increased by 25% over last year's profit  [#permalink]

### Show Tags

1
harish1986 wrote:
PKN wrote:
Bunuel wrote:
Company X's profits this year increased by 25% over last year's profits. Was the dollar amount of Company X's profits this year greater than the dollar amount of Company Y's?

(1) Last year, the ratio of Company Y's profits to Company X's profits was 5:2.
(2) Company Y experienced a 40% drop in profits from last year to this year.

NEW question from GMAT® Quantitative Review 2019

(DS14170)

Let company X's profit last year be p and company Y's profit be 'q' last year.
Company X's profits this year increased by 25% over last year's profits.
So X's profit this year=1.25p.---------------(1)

Question stem:- $$profit_{X}>profit_{Y} ?$$ (This year)

St1:- Last year, the ratio of Company Y's profits to Company X's profits was 5:2.
Or,$$\frac{p}{q}=\frac{5}{2}$$ -----------------(2)
No data available on profit of company Y this year. So, we can't determine any relationship between profit of X and Y this year.
Insufficient.

St2:-Company Y experienced a 40% drop in profits from last year to this year.
So Y's profit this year=0.6q-------------(3)

from (1) and (3),This year, $$\frac{profit_{X}}{profit_{Y}}=\frac{1.25p}{0.6q}=\frac{1.25}{0.6}*(\frac{p}{q})$$--(4)
Since p and q are unknown. We can't determine the above relationship.
Hence, insufficient.

combining, from (2), we have the ratio of p/q . Hence we can substitute it in (4). Therefore, we can say which company has more profit this year.

Sufficient.

(C)

Why shouldn't it be A? Since the profit of Y/X is given as 5:2 and X profits increased by 25 %, doesn't it give a clue?

Let us say X's profit is 200 and Y's profit is 500; the x profit will never go above 500.

We need to compare X's Profit this year and Y's Profit this year.

Statement 1 give us info about the ratio of Y's Profit last year and X's Profit last year. As a result, we can compare X's Profit this year and Y's Profit last year. However, we do not know anything about Y's Profit this year, we cannot compare X's Profit this year and Y's Profit this year. --> Statement 1 alone is not sufficient.

Statement 2 give us the relationship between Y's Profit last year and Y's Profit this year. Nothing related to X's profit is mentioned --> clearly not sufficient.

(1) + (2) we have all relationships needed --> Sufficient.
X's profit this year = (5/4)* X's profit last year = (5/4) * (2/5) * Y's profit last year = (5/4) * (2/5) * (5/3) * Y's profit this year

Hope it's clear.
_________________
（＾人＾） GMATCLUB Search for tags

Question Directory by Topic & Difficulty
Problem Solving | Data Sufficiency | Sentence Correction | Critical Reasoning | Reading Comprehension

ONLINE FREE (FULL LENGTH) GMAT CAT (PRACTICE TESTS) LINK COLLECTION
VP  D
Joined: 09 Mar 2016
Posts: 1229
Company X's profits this year increased by 25% over last year's profit  [#permalink]

### Show Tags

Bunuel wrote:
Company X's profits this year increased by 25% over last year's profits. Was the dollar amount of Company X's profits this year greater than the dollar amount of Company Y's?

(1) Last year, the ratio of Company Y's profits to Company X's profits was 5:2.
(2) Company Y experienced a 40% drop in profits from last year to this year.

NEW question from GMAT® Quantitative Review 2019

(DS14170)

niks18

here is my reasoning of problem
x = 1.25
y = 0.60
ratio y to x = 5 : 2 last year

ratio y to x = $$\frac{5-y}{2+x}$$ this year

combining two statements together $$\frac{1.25}{0.60}$$ = $$\frac{2+x}{5-y}$$

cross multiply (2+x)0.60 = 1.25(5-y) is it correct equation ?

if not where did I go wrong pls explain

thanks!
P.S. changed my solution 10 times Retired Moderator D
Joined: 25 Feb 2013
Posts: 1162
Location: India
GPA: 3.82
Re: Company X's profits this year increased by 25% over last year's profit  [#permalink]

### Show Tags

1
dave13 wrote:
Bunuel wrote:
Company X's profits this year increased by 25% over last year's profits. Was the dollar amount of Company X's profits this year greater than the dollar amount of Company Y's?

(1) Last year, the ratio of Company Y's profits to Company X's profits was 5:2.
(2) Company Y experienced a 40% drop in profits from last year to this year.

NEW question from GMAT® Quantitative Review 2019

(DS14170)

niks18

here is my reasoning of problem
x = 1.25
y = 0.60
ratio y to x = 5 : 2 last year

ratio y to x = $$\frac{5-y}{2+x}$$ this year

combining two statements together $$\frac{1.25}{0.60}$$ = $$\frac{2+x}{5-y}$$

cross multiply (2+x)0.60 = 1.25(5-y) is it correct equation ?

if not where did I go wrong pls explain

thanks!
P.S. changed my solution 10 times Hi dave13

I am not exactly sure, what you did there and how you got the highlighted part
VP  D
Joined: 09 Mar 2016
Posts: 1229
Company X's profits this year increased by 25% over last year's profit  [#permalink]

### Show Tags

niks18 wrote:
dave13 wrote:
Bunuel wrote:
Company X's profits this year increased by 25% over last year's profits. Was the dollar amount of Company X's profits this year greater than the dollar amount of Company Y's?

(1) Last year, the ratio of Company Y's profits to Company X's profits was 5:2.
(2) Company Y experienced a 40% drop in profits from last year to this year.

NEW question from GMAT® Quantitative Review 2019

(DS14170)

niks18

here is my reasoning of problem
x = 1.25
y = 0.60
ratio y to x = 5 : 2 last year

ratio y to x = $$\frac{5-y}{2+x}$$ this year

combining two statements together $$\frac{1.25}{0.60}$$ = $$\frac{2+x}{5-y}$$

cross multiply (2+x)0.60 = 1.25(5-y) is it correct equation ?

if not where did I go wrong pls explain

thanks!
P.S. changed my solution 10 times Hi dave13

I am not exactly sure, what you did there and how you got the highlighted part

niks18 i am not sure what i did there either but let me explain it

thanks for pointing out my mistake ok let write detailed solution which i dont think is correct but still

x profits this year = 1.25
y profits this year = 0.60

let X be the number of profits of company X
let Y be the number of profits of company Y

If last year ratio of profits Y to X was 5 : 2 or $$\frac{5}{2}$$

Then this Year ratio must be $$\frac{5 -y}{2+x}$$

Based on the above data i create an equation

$$\frac{1.25}{0.60} = \frac{2+x}{5 -y}$$ cross multiply and now again i got stuck  whats wrong with my solution how to get the value ? Hi pushpitkc , I think niks18 is on holiday maybe you can explain ? hi gmatbusters can you please bust this qustion for me ? i need correct detailed sulotion based on my wrong solution above  Retired Moderator V
Joined: 27 Oct 2017
Posts: 1274
Location: India
GPA: 3.64
WE: Business Development (Energy and Utilities)
Re: Company X's profits this year increased by 25% over last year's profit  [#permalink]

### Show Tags

1
Hi @dave13,
I tried to explain the error, Please let me know if it is not clear.

dave13 wrote:
Company X's profits this year increased by 25% over last year's profits. Was the dollar amount of Company X's profits this year greater than the dollar amount of Company Y's?

(1) Last year, the ratio of Company Y's profits to Company X's profits was 5:2.
(2) Company Y experienced a 40% drop in profits from last year to this year.

NEW question from GMAT® Quantitative Review 2019

(DS14170)

here is my reasoning of problem
x = 1.25
y = 0.60
ratio y to x = 5 : 2 last year

ratio y to x = $$\frac{5-y}{2+x}$$ this year

combining two statements together $$\frac{1.25}{0.60}$$ = $$\frac{2+x}{5-y}$$

cross multiply (2+x)0.60 = 1.25(5-y) is it correct equation ?

if not where did I go wrong pls explain

thanks!
P.S. changed my solution 10 times [/quote]

Hi dave13

I am not exactly sure, what you did there and how you got the highlighted part[/quote]

niks18 i am not sure what i did there either but let me explain it

thanks for pointing out my mistake ok let write detailed solution which i dont think is correct but still

x profits this year = 1.25 ,
y profits this year = 0.60

It is wrong, we cannot take x and y as you did, because it will be only possible if both x and y have equal profit =1.

let X be the number of profits of company X- last year
let Y be the number of profits of company Y- last year

If last year ratio of profits Y to X (last year) was 5 : 2 or $$\frac{5}{2}$$

Then this Year ratio must be $$\frac{5 -y}{2+x}$$- NOT VALID

Based on the above data i create an equation

[m]\frac{1.25}{0.60} = \frac{2+x}{5 -y}[/m
] cross multiply and now again i got stuck  whats wrong with my solution how to get the value ? Hi pushpitkc[/url] , I think niks18 is on holiday maybe you can explain ? higmatbusters[/url] can you please bust this qustion for me ? i need correct detailed sulotion based on my wrong solution above  [/quote]
_________________
Retired Moderator V
Joined: 27 Oct 2017
Posts: 1274
Location: India
GPA: 3.64
WE: Business Development (Energy and Utilities)
Company X's profits this year increased by 25% over last year's profit  [#permalink]

### Show Tags

1
Let the profit of X last year = x
Let the profit of Y last year = y

This year , X profit = X'= 1.25x
Y this year profit = Y' ?

To find whether X'>Y' ?
Statement 1 : $$\frac{y}{x}$$= $$\frac{5}{2}$$
So y = 2.5x

But Y' is not known, NOT SUFFICIENT.

Statement 2: Y' = 0.6y
But we don't know the relation between x and y , NOT SUFFICIENT.

Combining Statement 1 & 2, We get
Y this year profit = Y' = 0.6y = 0.6*2.5x = 1.5x
Also from Question stem, X profit = X'= 1.25x

So, X'<Y'

SUFFICIENT

Bunuel wrote:
Company X's profits this year increased by 25% over last year's profits. Was the dollar amount of Company X's profits this year greater than the dollar amount of Company Y's?

(1) Last year, the ratio of Company Y's profits to Company X's profits was 5:2.
(2) Company Y experienced a 40% drop in profits from last year to this year.

NEW question from GMAT® Quantitative Review 2019

(DS14170)

_________________
VP  D
Joined: 09 Mar 2016
Posts: 1229
Re: Company X's profits this year increased by 25% over last year's profit  [#permalink]

### Show Tags

gmatbusters wrote:
Let the profit of X last year = x
Let the profit of Y last year = y

This year , X profit = X'= 1.25x
Y this year profit = Y' ?

To find whether X'>Y' ?
Statement 1 : $$\frac{y}{x}$$= $$\frac{5}{2}$$
So y = 2.5x

But X' is not known, NOT SUFFICIENT.

Statement 2: Y' = 0.6y
But we don't know the relation between x and y , NOT SUFFICIENT.

Combining Statement 1 & 2, We get
Y this year profit = Y' = 0.6y = 0.6*2.5x = 1.5x
Also from Question stem, X profit = X'= 1.25x

So, X'<Y'

SUFFICIENT

Bunuel wrote:
Company X's profits this year increased by 25% over last year's profits. Was the dollar amount of Company X's profits this year greater than the dollar amount of Company Y's?

(1) Last year, the ratio of Company Y's profits to Company X's profits was 5:2.
(2) Company Y experienced a 40% drop in profits from last year to this year.

NEW question from GMAT® Quantitative Review 2019

(DS14170)

hi gmatbusters many thanks for response and explanation: just one question how did you get this So y = 2.5x ?

I understand that $$\frac{y}{x}$$ = $$\frac{5}{2}$$ but somehow cant undestand how you got y = 2.5x thank you! Retired Moderator V
Joined: 27 Oct 2017
Posts: 1274
Location: India
GPA: 3.64
WE: Business Development (Energy and Utilities)
Company X's profits this year increased by 25% over last year's profit  [#permalink]

### Show Tags

1
Your Query : I understand that $$\frac{y}{x}$$ = $$\frac{5}{2}$$ but somehow cant undestand how you got y = 2.5x Response : y/x = 5/2= 2.5, now multiply both sides by x ,
we get y = 2.5x. hope it is clear now.
dave13 wrote:
gmatbusters wrote:
Let the profit of X last year = x
Let the profit of Y last year = y

This year , X profit = X'= 1.25x
Y this year profit = Y' ?

To find whether X'>Y' ?
Statement 1 : $$\frac{y}{x}$$= $$\frac{5}{2}$$
So y = 2.5x

But X' is not known, NOT SUFFICIENT.

Statement 2: Y' = 0.6y
But we don't know the relation between x and y , NOT SUFFICIENT.

Combining Statement 1 & 2, We get
Y this year profit = Y' = 0.6y = 0.6*2.5x = 1.5x
Also from Question stem, X profit = X'= 1.25x

So, X'<Y'

SUFFICIENT

Bunuel wrote:
Company X's profits this year increased by 25% over last year's profits. Was the dollar amount of Company X's profits this year greater than the dollar amount of Company Y's?

(1) Last year, the ratio of Company Y's profits to Company X's profits was 5:2.
(2) Company Y experienced a 40% drop in profits from last year to this year.

NEW question from GMAT® Quantitative Review 2019

(DS14170)

hi gmatbusters many thanks for response and explanation: just one question how did you get this So y = 2.5x ?

I understand that $$\frac{y}{x}$$ = $$\frac{5}{2}$$ but somehow cant undestand how you got y = 2.5x thank you! _________________
Retired Moderator V
Joined: 27 Oct 2017
Posts: 1274
Location: India
GPA: 3.64
WE: Business Development (Energy and Utilities)
Re: Company X's profits this year increased by 25% over last year's profit  [#permalink]

### Show Tags

Yes we can solve this question by taking numbers.

Aim: To find Whether X this year profit is greater than Y ?
Let X last year profit = 100
X this year profit = 125

Aim reduces to: finding Y profit this year

St1) Y last year profit = 5/2 times X last year profit = 250
But we have no idea of Y this year profit.

St2) Y profit dropped by 40% this year
But we don't know Y profit last year, so insufficient to find Y profit this year.

Combinin St1 & 2, We et
Y last year profit = 0.6*Y last year profit = 0.6*250= 150

hence , We can answer that X this year profit is not greater than Y this year profit.

SUFFICIENT,

_________________
Director  G
Joined: 19 Oct 2013
Posts: 511
Location: Kuwait
GPA: 3.2
WE: Engineering (Real Estate)
Re: Company X's profits this year increased by 25% over last year's profit  [#permalink]

### Show Tags

1
Bunuel wrote:
Company X's profits this year increased by 25% over last year's profits. Was the dollar amount of Company X's profits this year greater than the dollar amount of Company Y's?

(1) Last year, the ratio of Company Y's profits to Company X's profits was 5:2.
(2) Company Y experienced a 40% drop in profits from last year to this year.

NEW question from GMAT® Quantitative Review 2019

(DS14170)

x1 be for last year
x2 be for this year

x2 = x1 * 1.25

we want to know y2 > x2?

Statement 1) tells us that y1 to x1 is 5a to 2a

this is insufficient because I don't know how will the y2 change.

Statement 2) tells us that y2 = 0.6 * y1

But I don't have any basis of comparison between x2 and y2

Statement (1) and (2) combined tells us that y2 = 5a * 6/10 = 3a and x2 = 2a * 1.25 = 5/4 * 2 = 5/2 = 2.5a

3a > 2.5a

Manager  B
Joined: 19 Jan 2018
Posts: 79
Re: Company X's profits this year increased by 25% over last year's profit  [#permalink]

### Show Tags

1
Bunuel wrote:
Company X's profits this year increased by 25% over last year's profits. Was the dollar amount of Company X's profits this year greater than the dollar amount of Company Y's?

(1) Last year, the ratio of Company Y's profits to Company X's profits was 5:2.
(2) Company Y experienced a 40% drop in profits from last year to this year.

NEW question from GMAT® Quantitative Review 2019

(DS14170)

From the question stem:
Company X Profit (This Year) = 1.25(Company X Profit Last Year)

Is Company X Profit (This Year) > Company Y Profit (This Year)?

Statement 1:
$$\frac{Company Y Profit}{Company X Profit} = \frac{5}{2}$$

We know that Company X profit this year increased by 25%, so:

$$\frac{Company Y Profit}{Company X Profit} = \frac{5}{(2*1.25)}$$
But we don't know if Company's Y profit increased or decreased from last year or this year.
Statement 1 is insufficient (Cross out A and D)

Statement 2:

Company Y Profit (This Year) = 0.60(Company Y Profit Last Year), but we don't know anything about the starting values of Y
Statement 2 Insufficient (Cross out C)

Both:

When we combine both statements:

$$\frac{This Year Company Y Profit}{This Year Company X Profit} = \frac{(5*0.6)}{(2*1.25)}$$

Enough data to determine which is larger. Re: Company X's profits this year increased by 25% over last year's profit   [#permalink] 29 Aug 2019, 09:05
Display posts from previous: Sort by

# Company X's profits this year increased by 25% over last year's profit  