The graph shows the revenue (the solid black line)

Question

https://gmatclub.com/forum/download/file.php?id=88526 The graph shows the revenue (the solid black line) and the cost (the dotted green line) of QN Corp for each year from 2012 through 2017. From the drop-down menus, select the options that create the most accurate statement based on the information provided. The year GRAPH_1_PLACEHOLDER had the greatest percent increase in profit over the prior year, and that percent increase was approximately GRAPH_2_PLACEHOLDER GMAT-Club-Forum-lrivy98o.png

SanuBest · Answer

Why 50% and not 33%?

BJ2024 · Answer

First, let's calculate the  profit  for each year (Revenue − Cost):
 
  2012:  $37.5 - 32.5 = 5$ million 
  2013:  $40.0 - 35.0 = 5$ million 
  2014:  $37.5 - 30.0 = 7.5$ million 
  2015:  $50.0 - 40.0 = 10$ million 
  2016:  $62.5 - 50.0 = 12.5$ million 
  2017:  $65.0 - 50.0 = 15$ million  
Next, let's calculate the  percentage increase  in profit over the prior year:
 
  2013:  (5 - 5)/5*100% =0% 
  2014:  (7.5 - 5)/5*100% = 50% 
  2015:  (10 - 7.5)/7.5*100%=33.3% 
  2016:  (12.5 - 10)/10*100% = 25% 
  2017:  (15 - 12.5)/12.5*100%= 20%  
Hence,  2014  had the highest percent increase in  profit .

SanuBest · Answer

Thank you!
I missed the profit part, was calculating the %increase for revenue instead.

RahulSax · Answer

The question has asked   greatest percent increase in profit over the prior year   
Now, we know that
 Profit = Revenue - Cost

For  2014 : Revenue - Cost = 37.5 -30 = 7.5
For  2013 : Revenue - Cost = 40 - 35 = 5

So, Percentage increase = (7.5-5)/5 x 100 =  50%

As the years are increasing the profits are increasing but the profit % is decreasing

Hence, year is  2014  and percent increase is  50%

Hope it helps

SanuBest · Answer

Thank you so much!

rockstar09rulez · Answer

Is there an easy way to spot which values should be calculated, or we need to calculate all and figure out the highest % increase?

Praful_0810 · Answer

The graph shows the revenue (the solid black line) and the cost (the dotted green line) of QN Corp for each year from 2012 through 2017.
From the drop-down menus, select the options that create the most accurate statement based on the information provided.

The year 2014 had the greatest percent increase in profit over the prior year, and that percent increase was approximately 
50%

I approached it this way: on vertical axis, each point or line is getting increased by 2.5 millions which I considered x profit.
So in 2013 - 2x; 2014 - 3x; 2015 - 4x; and 2016 - 5x
the difference in profit between any two consecutive years x. So while calculating increase %, whichever years denominator is small will be the answer. Hence In case of 2014, denominator is 2x which implies that profit jumped by 50%

The graph shows the revenue (the solid black line)

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The graph shows the revenue (the solid black line)

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