Hi Diksha ,
I wonder how your test had been , aah what a foolhardy assumption , you must be in a top B school by now , but if you are still wondering , for a little formula ,Maybe this might help
Say ,there is a 100 litre of a solution with 36 litres of milk .x quantity is taken each time and replaced with an equal amount of water . This has been repeated once more .What is x , if the remaining percentage of milk is 25%.
The formula for finding this would be
(Percentage of milk left after the final iteration)/Percentage of milk at the beginning =(1-R/T)^n
Where n is the number of iterations done, in our case 2.
R is the quantity removed , in our case x
and T is the total volume of the solution , in our case 100
So percentage of milk at the beginning is 36% since we have 36 litres in 100 litres of solution .
so here
25/36=(1-x/100)^2
so taking the square root on both sides
5/6=1-x/100
x=100/6 which is 16.66 litres
Hope this helps , this is my very first post here , kudos me , and well happy GMAT to you ^^