In a certain township, C-1 commercial property is taxed at a

Question

In a certain township, C-1 commercial property is taxed at a rate 25 percent higher per acre than R-1 residential property. If tax revenues on the two types of property are solely a function of tax rates, what was the ratio of tax revenues derived from C-1 commercial property to tax revenues derived from R-1 residential property last year?

(1) Last year, revenues derived from taxes on C-1 commercial property were $10 million, and revenues derived from taxes on R-1 residential property were $4 million.
(2) Last year, twice as many acres were taxed as C-1 commercial property as were taxed as R-1 residential property

ruhi · Answer

Is it A or am I missing soemthing???... :oops:

gayathri · Answer

I will go for E

Total tax revenue = tax rate% * Value/ acre * number of acres.
Question stem: Rate of C1 = 125% rate of R1

s : Gives total revenue for C1 and R1 but we do not know if its an apple to apple comparison. As in are the land values the same and is the acreage the same? Insufficient

s : Gives a relation between acreage of R1 and C1. On its own its still insufficient.

s  + s : We now have two of the missing variables relation between acreage and total revenues. 

If the underlying assumption is the two townships have same land value then answer would be C. 
But since we dont know that, C is insufficient.

ruhi · Answer

Isnt it given that the land-revenue is solely the function of tax rate?? So why do we need acreage, land values etc???

gayathri · Answer

Is it C?

I am assuming since the tax revenues are dependent on tax rates alone, the value is assumed to be the same. B tells you if you are comparing same acres. Combing A & B you get the ratio of tax revenue...

ruhi · Answer

Doesnt the first statement SPELL out the tax revenue?? If thats the case, Ill go with D.

rthothad · Answer

I would go for 'D'
From 1: 10/4 
From 2: Let C-1 be 100 acres @ 1.25/acre so, R-1 is 50 acres @ 1.00/acre => (100 * 1.25)/(50 * 1)

twixt · Answer

If we assume that Rc and Rr are the tax rates and Ac and Ar the number of related acres, the ratio we are looking for is equal to Ac.Rc/(ArRr)

and we know that Rc=1,25Rr

1st statement is obviously true
2nd statement : Ac= 2Ar enough

So I pick D

MA · Answer

Either statement is sufficient to answer the question.
(i) C1:R1=10:4=2.5:1
(ii) C1:R1=(1.25P x 2R) : PxR: =2.5:1

venksune · Answer

D it is. Very well explained by MA, twixt, rthothad

In a certain township, C-1 commercial property is taxed at a

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