Last visit was: 13 Dec 2024, 13:44 It is currently 13 Dec 2024, 13:44
Home
GMAT
Messages
Tests
Schools
Reviews
Social
Chat
My Profile
Close
GMAT Club Daily Prep
Thank you for using the timer - this advanced tool can estimate your performance and suggest more practice questions. We have subscribed you to Daily Prep Questions via email.

Customized
for You

we will pick new questions that match your level based on your Timer History

Track
Your Progress

every week, we’ll send you an estimated GMAT score based on your performance

Practice
Pays

we will pick new questions that match your level based on your Timer History
Not interested in getting valuable practice questions and articles delivered to your email? No problem, unsubscribe here.
Go to My Error Log Learn more
Close
Request Expert Reply
Confirm Cancel
Back to Forum
Create Topic
User avatar
Bunuel
User avatar
Math Expert
Joined: 02 Sep 2009
Last visit: 13 Dec 2024
Posts: 97,873
Own Kudos:
685,612
 []
Given Kudos: 88,268
Products:
GMAT Club Tests Forum Quiz
Expert reply
Active GMAT Club Expert! Tag them with @ followed by their username for a faster response.
Posts: 97,873
Kudos: 685,612
 []
The graph on the left shows the annual revenue growth rate of Company 14 Jul 2015, 00:53
Kudos
Add Kudos
1
Bookmarks
Bookmark this Post
00:00
Start Timer
Pause Timer
Resume Timer
Show Answer
Hide
Show
History
B
Be sure to select an answer first to save it in the Error Log before revealing the correct answer (OA)!

Difficulty:

55% (hard)

Question Stats:

68% (02:41) correct 32% (03:01) wrong based on 118 sessions

History

Date
Time
Result
Not Attempted Yet

The graph on the left shows the annual revenue growth rate of Company X. The graph on the right shows the tax rate as a percent of revenue for each year. If Company X's revenue in year ‘99 was $98.1 million, which one of the following is closest to how much more the company paid in taxes in year ‘01 than ‘00?

A. $4 million
B. $6 million
C. $13 million
D. $15 million
E. $20 million

Kudos for a correct solution.

Show Spoiler
Attachment:
test3_qt19.gif
test3_qt19.gif [ 5.89 KiB | Viewed 3846 times ]
ShowHide Answer
Official Answer
B
User avatar
GMATinsight
User avatar
GMAT Club Legend
Joined: 08 Jul 2010
Last visit: 13 Dec 2024
Posts: 6,074
Own Kudos:
14,605
 []
Given Kudos: 125
Status:GMAT/GRE Tutor l Admission Consultant l On-Demand Course creator
Location: India
GMAT: QUANT+DI EXPERT
Schools: IIM (A) ISB '24
GMAT 1: 750 Q51 V41
WE:Education (Education)
Products:
My Reviews
Expert reply
Active GMAT Club Expert! Tag them with @ followed by their username for a faster response.
Schools: IIM (A) ISB '24
GMAT 1: 750 Q51 V41
Posts: 6,074
Kudos: 14,605
 []
The graph on the left shows the annual revenue growth rate of Company Updated on: 14 Jul 2015, 04:19
Originally posted by GMATinsight on 14 Jul 2015, 03:00.
Last edited by GMATinsight on 14 Jul 2015, 04:19, edited 1 time in total.
1
Kudos
Add Kudos
Bookmarks
Bookmark this Post
Bunuel

The graph on the left shows the annual revenue growth rate of Company X. The graph on the right shows the tax rate as a percent of revenue for each year. If Company X's revenue in year ‘99 was $98.1 million, which one of the following is closest to how much more the company paid in taxes in year ‘01 than ‘00?

A. $4 million
B. $6 million
C. $13 million
D. $15 million
E. $20 million

Kudos for a correct solution.

Show Spoiler
Attachment:
test3_qt19.gif

99' Revenue = 98.1

00' Revenue = 1.04*98.1 = 102.024
tax in 00' = 20% of 102.024 = 20.4084


01' Revenue = 1.05*102.024 = 107.1252
tax in 00' = 25% of 107.1252 = 26.7813

Difference in taxes of 01' and 00 = 26.7813 - 20.4084 = $6 million approx

Answer: option B
User avatar
balamoon
User avatar
Joined: 26 Dec 2011
Last visit: 21 Jun 2019
Posts: 111
Own Kudos:
281
 []
Given Kudos: 91
Schools: HBS '18 IIMA
Schools: HBS '18 IIMA
Posts: 111
Kudos: 281
 []
The graph on the left shows the annual revenue growth rate of Company 14 Jul 2015, 03:48
2
Kudos
Add Kudos
Bookmarks
Bookmark this Post
GMATinsight
Bunuel

The graph on the left shows the annual revenue growth rate of Company X. The graph on the right shows the tax rate as a percent of revenue for each year. If Company X's revenue in year ‘99 was $98.1 million, which one of the following is closest to how much more the company paid in taxes in year ‘01 than ‘00?

A. $4 million
B. $6 million
C. $13 million
D. $15 million
E. $20 million

Kudos for a correct solution.

Show Spoiler
Attachment:
test3_qt19.gif

99' Revenue = 98.1

00' Revenue = 1.02*98.1 = 102.024
tax in 00' = 20% of 102.024 = 20.4084


01' Revenue = 1.05*102.024 = 107.1252
tax in 00' = 25% of 107.1252 = 26.7813

Difference in taxes of 01' and 00 = 26.7813 - 20.4084 = $6 million approx

Answer: option B

Hi GMATinsight,
Correction -
Though 00' Revenue is correct, percentage increase is 4, not 2.
00' Revenue = 1.02*98.1 = 102.024
User avatar
Bunuel
User avatar
Math Expert
Joined: 02 Sep 2009
Last visit: 13 Dec 2024
Posts: 97,873
Own Kudos:
685,612
Given Kudos: 88,268
Products:
GMAT Club Tests Forum Quiz
Expert reply
Active GMAT Club Expert! Tag them with @ followed by their username for a faster response.
Posts: 97,873
Kudos: 685,612
The graph on the left shows the annual revenue growth rate of Company 19 Jul 2015, 12:39
Kudos
Add Kudos
Bookmarks
Bookmark this Post
Bunuel

The graph on the left shows the annual revenue growth rate of Company X. The graph on the right shows the tax rate as a percent of revenue for each year. If Company X's revenue in year ‘99 was $98.1 million, which one of the following is closest to how much more the company paid in taxes in year ‘01 than ‘00?

A. $4 million
B. $6 million
C. $13 million
D. $15 million
E. $20 million

Kudos for a correct solution.

Show Spoiler
Attachment:
test3_qt19.gif

800score Official Solution:

There are a few steps to solving this problem:
First, given 1999 revenue of $98.1 million, we can find the revenue in 2000 and 2001 because the increase from 1999 to 2000 was 4% and the increase from 2000 to 2001 was 5% (Note: since the answer says “closest,” rounding can be done in the calculations):
1999: $98.1 million
2000: ($98.1)(1.04) = $102 million
2001: ($102)(1.05) = $107 million.

Now, given each year's revenue amounts, calculate the taxes paid:
2000: ($102)(0.20) = $20 million
2001: ($107)(0.25) = $27 million.

Now subtract the 2000 tax amount from the 2001 amount:
$27 – $20 = $7 million.

Company X paid $7 million more in taxes in 2001 than it did in 2000. The closest answer is choice (B), which is the correct answer.
User avatar
mvictor
User avatar
Board of Directors
Joined: 17 Jul 2014
Last visit: 14 Jul 2021
Posts: 2,136
Own Kudos:
1,219
Given Kudos: 236
Location: United States (IL)
Concentration: Finance, Economics
Schools: Stanford '20 (WD)
GMAT 1: 650 Q49 V30
GPA: 3.92
WE:General Management (Transportation)
Products:
My Reviews
Schools: Stanford '20 (WD)
GMAT 1: 650 Q49 V30
Posts: 2,136
Kudos: 1,219
The graph on the left shows the annual revenue growth rate of Company 18 Nov 2015, 20:25
Kudos
Add Kudos
Bookmarks
Bookmark this Post
I solved it with approximations as well

98 mln - 100% -> 0.98 = 1% or ~1 mln = 1% thus 4mln added in 2000.
we have 102 mln in 00, and increase of 5 % in revenue -> 10.2 is 10% and 5.1 mln is 5%
thus, revenue in 01 is 107.1 mln

now, from 102 mln company paid 20% or 20.4 mln
from 107.1 paid 25%. 10.7 = 10%. 21.4 = 20%, 5.35 = 5% -> total tax paid in 01 = 26.75 mln

now, 26.75-20.4 mln = ~ 6 mln.
B.
User avatar
bumpbot
User avatar
Non-Human User
Joined: 09 Sep 2013
Last visit: 04 Jan 2021
Posts: 35,810
Own Kudos:
929
Posts: 35,810
Kudos: 929
The graph on the left shows the annual revenue growth rate of Company 08 Jan 2020, 20:03
Kudos
Add Kudos
Bookmarks
Bookmark this Post
Hello from the GMAT Club BumpBot!

Thanks to another GMAT Club member, I have just discovered this valuable topic, yet it had no discussion for over a year. I am now bumping it up - doing my job. I think you may find it valuable (esp those replies with Kudos).

Want to see all other topics I dig out? Follow me (click follow button on profile). You will receive a summary of all topics I bump in your profile area as well as via email.
Moderator:
Bunuel
Math Expert
97873 posts