a magazine, currently sold on the newsstand at 2$ per copy

Question

a magazine, currently sold on the newsstand at 2$ per copy is to have the newsstand price increased 50%. what will be the percentage increase in revenue from the new price on the newsstands ?

1) at the original price, 30.000 copies are sold on newsstands.

2) for every 0,25$ increase in price, there is a reduction of 5% in the numbers sold on the newsstands.

ketanm · Answer

Answer (B)

From (1), when price is 3$, how much sold is not known

From (2), let 'x' magazines sold initiallly. Then 

Initial Revenue = 2x $

For every 0.25$ increase, 5% reduction in numbers 

For first 0.25$ increase, 0.95x is the number of copies
For next 0.25$ increase, 0.95(0.95x) is the number of copies...

and so on.. till we reach the new price at 3$, at which the 
number of copies sold will be Y = (0.95)^4 * x

% revenue increase =   * 100


Hence can be found out from (2) itself. No need to know the actual value of 'x' since the final result required is % increase in revenues...

singh · Answer

C ..

present revenue = 30k * 2

New = (.95)^4 * 30k * 3

assuming 0,25$ -> 0.25$

700Plus · Answer

B.
every .5 increase reduces 5% sales.Revenue increase is asked not the actual revenue.Info is sufficient.

mirhaque · Answer

B.

WE DON'T NEED TO KNOW THE NO OF COPIES SOLD TO FIGURE % INCREASE IN REVENUE. 

LET 100 COPIES SOLD. 
REVENUE AT ORIGINAL PRICE=200
REVENUE AT INCREASED PRICE = 240. 
% INCREAE = 20%

LET 30,000 COPIES SOLD
REVENUE AT ORIGINAL PRICE=60,000
REVENUE AT INCREASED PRICE = 72,000
% INCREAE = 20%

a magazine, currently sold on the newsstand at 2$ per copy

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