This is good question to understand the concept of SD.
Let's consider set (2,4,12)
Mean=6
Sd=(((6-2)^2+(6-4)^2+(6-12)^2)/3)^1/2=(56/3)^1/2=2*(14/3)^1/2
Let's add a constant of 3 to each term of the set= (5,7,15)
Mean=9 (Increased by the same constant)
SD=(((9-5)^2+(9-7)^2+(9-15)^2)/3)^1/2=(56/3)^1/2=2*(14/3)^1/2
SD=2*(14/3)^1/2, didn't change!
Let's increase each term of a set by the same (50%) percent=(3,6,18)
Mean=9 (Increased by the same percent)
SD=(((9-3)^2+(9-6)^2+(9-18)^2)/3)^1/2=(126/3)^1/2=3(14/3)^1/2
SD=3(14/3)^1/2, increased by the same percent
So, here is the TIP:
If we add or subtract a constant to each term in a set:
Mean will increase or decrease by the same constant.
SD will not change.
If we increase or decrease each term in a set by the same percent:
Mean will increase or decrease by the same percent.
SD will increase or decrease by the same percent
Basically from the above it's obvious that if we were only told that mean decreased, increased or remained the same we won't be able to determine new SD.
So, in our question:
(1) As each term decreased by the same percent SD will decrease by the same percent --> 10*0.7=7=New SD. Sufficient.
(2) The average decreased by 37 percent, says nothing about the SD. Not sufficient
Answer A.