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Dropdown 1: Second
Dropdown 2: C's
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Corporation X has three divisions (Divisions A, B, and C). For each quarter of the last fiscal year, the graph shows the percentage of the corporation's total net profit through the end of that quarter from the three divisions. In each of the quarters, each division had an increase in net profit compared to the prior quarter.
From each drop-down menu, select the option that creates the most accurate statement based on the information given.
Based on the available information, it must be the case that, in the Quarter, Division net profit more than doubled from the prior quarter.
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03 Dec 2023, 17:52
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Video solution here:
This question's structure is similar to this other one from Focus edition practice tests #1 and #2, in which we have to distinguish between percentages and actual numbers: https://gmatclub.com/forum/topic422160.html#p3305913
This question's structure is similar to this other one from Focus edition practice tests #1 and #2, in which we have to distinguish between percentages and actual numbers: https://gmatclub.com/forum/topic422160.html#p3305913
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10 Jun 2024, 01:37
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parkhydel
If your understanding of percentages is good, you need to do no calculations here. But I will show using some numbers too at the end.
The graph gives the percentage contribution of each division in each quarter. So in first quarter, A contributed 20% to the total profit, B contributed 50% to the profit revenue and C contributed 30% to the total profit.
We are given that "In each of the quarters, each division had an increase in net profit compared to the prior quarter."
But the percentage contribution has sometimes increased and sometimes decreased. Why? Because another division's profit increased by a much larger percentage increasing the overall profit by a whole lot more.
Based on the available information, it must be the case that, in the _____ Quarter, Division ____ net profit more than doubled from the prior quarter.
First I will look for a division for which we see a big increase in percentage contribution from 1 year to the next. I see that for division C the percentage increases from 30% to about 58% from quarter 1 to quarter 2. All other increases are relatively very modest.
I also see that from first to second quarter the percentage of division B has reduced from 50% to 25%. But since its profit increased from quarter 1 to quarter 2, it means the overall profit more than doubled in quarter 2.
ANSWER: Select 'Second' and 'C's' and move on.
If it is not clear, here are some numbers:
Say profit in quarter 1 is $100 ($20 from A, $50 from B and $30 from C)
Division B had more than $50 profit in quarter 2 which was 25% of the total profit so total profit in quarter 2 was "more than $200."
Division C's profit in quarter 2 is 58% of "more than $200" which is "more than $116" (almost 4 times the first quarter profit of division C)
