Multiple choice

In 2005, a company sold a brand of shoes to the retailers for a fixed price per pair. In 2006, the number of pairs sold to the retailers decreased by 20 percent, while the price per pair increased by 20 percent. If the company's revenue from the sale of the shoes in 2006 was $3.0 million, what was the approximate revenue from the sale of the shoes in 2005?

  1. $2.4 million
  2. $2.9 million
  3. $3.0 million
  4. $3.1 million
  5. $3.6 million
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Let R1 be 2005 revenue, N be pairs, P be price. R1 = N * P. In 2006, N' = 0.8N and P' = 1.2P. Revenue R2 = 0.8N * 1.2P = 0.96 * R1. Given R2 = 3.0 million, R1 = 3.0 / 0.96 = 3.125 million.

AI explanation

Let the 2005 revenue be R; the 2006 revenue equals 0.80 multiplied by 1.20, resulting in 0.96 of R. We set 0.96 times R equal to 3.0 million dollars. Solving for R gives 3.0 million divided by 0.96, which equals 3.125 million. The approximate revenue from the sale of the shoes in 2005 is $3.1 million.

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