Question

Last year, the price per transaction of certain company increases P percent from the year before, and the number of transactions increase N percent from the year before. Total revenue is simply the number of transactions times the price per transaction. Assume this one transaction is this company's only source of revenue. Which of the following is the percent increase in revenue last year, from the year before?

a. P*N%
b. (P+N)
c. (P+N+P*N/100)%
d. (P+N-P*N/100)%
e. (P*N+(P*N)²/100)%

Answer 1

To calculate the percent increase in revenue, multiply (1+P/100) and (1+N/100), subtract 1, and multiply the result by 100%.

Step-by-step explanation:

To calculate the percent increase in revenue, we need to consider the increase in price per transaction (P percent) and the increase in the number of transactions (N percent). Total revenue is the product of the number of transactions and the price per transaction.

Let's denote the revenue of the previous year as R0. The revenue of the current year can be calculated as R1 = (1+P/100)(1+N/100)R0.

To find the percent increase in revenue, we need to calculate the difference between R1 and R0 as a percentage of R0. The difference is R1 - R0 = ((1+P/100)(1+N/100) - 1)R0.

The percent increase in revenue can be calculated as ((R1 - R0)/R0) * 100%. Simplifying the expression, we get ((1+P/100)(1+N/100) - 1) * 100%.

Therefore, the correct option is (P+N+P*N/100)% (option c).