bhandariavi wrote:

:oops: Firm A's revenues are described by the equation Ra = 17.12x and its costs by Ca = 12.87x + 2400.

Firm B's revenues are described by the equation Rb = 13.27x and its costs by Cb = 8.77x + 1500.

(x denotes the quantity of sales).

If A's volume of sales increases from 1000 to 2000 over the same period that B's volume increases from 2000 to 3000, the percent increase in profits for the firm with the biggest dollar increase in profits is

1) 20% 2)30% 3) 60% 4)50% 5)33%

I can calculate the answer But i need the short cut way to do this.

Testluv, Bunuel, Pkit, shrouded1, icandynyone or anyone who can solve this with short cut approach ----Help me!!!!!!

We need to compare profits so find out profit in the two cases:

A: 17.12x - (12.87x + 2400) = 4.25x - 2400

B: 13.27x - (8.77x + 1500) = 4.5x - 1500

In both cases, x changes by 1000 so B will give a higher dollar increase (because 4.5 > 4.25)

% increase in B's profit: \(\frac{4.5*1000}{{4.5*2000 - 1500}} * 100 = 60%\)

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