Question

In 1998 the profits of company N were 10 percent of revenues. In 1999, the revenues of company N fell by 20 percent, but profits were 15 percent of revenues. The profits in 1999 were what percent of the profits in 1998?

A. 80%
B. 105%
C. 120%
D. 124.2%
E. 138%

Answer 1

C. 120%

Step-by-step explanation:

We assume the revenues in 1998 is $100

So, the profit in 1998 would be

= $100 × 10%

= $10

And, in 1999, the revenue is fall by 20%

So, the revenue in 1999 would be

= $100 - $100 × 20%

= $80

And, the profit in 1999 would be

= $80 × 15%

= $12

So, the profit percentage would be

= Profit in 1999 ÷ Profit in 1998

= $12 ÷ $10

= 120%