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

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

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02 Aug 2018, 22:42
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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)

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

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03 Aug 2018, 01:56
2
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)
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Re: Company X's profits this year increased by 25% over last year's profit  [#permalink]

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03 Aug 2018, 08:57
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.
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Re: Company X's profits this year increased by 25% over last year's profit  [#permalink]

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03 Aug 2018, 09:33
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.
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Company X's profits this year increased by 25% over last year's profit  [#permalink]

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05 Aug 2018, 05:28
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
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Re: Company X's profits this year increased by 25% over last year's profit  [#permalink]

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05 Aug 2018, 09:31
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
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Posts: 1232
Company X's profits this year increased by 25% over last year's profit  [#permalink]

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06 Aug 2018, 05:23
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
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Re: Company X's profits this year increased by 25% over last year's profit  [#permalink]

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11 Aug 2018, 07:41
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]
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Company X's profits this year increased by 25% over last year's profit  [#permalink]

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11 Aug 2018, 07:50
1
dave13, please see this approach
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)

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Joined: 09 Mar 2016
Posts: 1232
Re: Company X's profits this year increased by 25% over last year's profit  [#permalink]

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11 Aug 2018, 08:02
gmatbusters wrote:
dave13, please see this approach
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!
Senior DS Moderator
Joined: 27 Oct 2017
Posts: 1137
Location: India
Concentration: International Business, General Management
GPA: 3.64
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Company X's profits this year increased by 25% over last year's profit  [#permalink]

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11 Aug 2018, 08:10
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:
dave13, please see this approach
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!

_________________
Senior DS Moderator
Joined: 27 Oct 2017
Posts: 1137
Location: India
Concentration: International Business, General Management
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]

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11 Aug 2018, 19:46
Replying to a PM,
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.
So insufficient to answer.

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,

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Re: Company X's profits this year increased by 25% over last year's profit  [#permalink]

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18 Oct 2018, 07:37
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

sufficient. Answer choice C
Re: Company X's profits this year increased by 25% over last year's profit &nbs [#permalink] 18 Oct 2018, 07:37
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# Company X's profits this year increased by 25% over last year's profit

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