MBA aspirants who are appearing in XAT 2021 in January may find following questions with solutions very useful:

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The following graphs shows the revenue (in $ million) of three companies in their initial six years of operations, in an economy which is characterized by a persistent inflation.

**Question 1)**

In 2010, which could be a valid statement about the revenues (adjusted for inflation) of these three companies?

- Revenues of all three companies were equal.
- Revenues of all three companies could be equal.
- Revenue of Yahoo was definitely less than Facebook which was definitely less than Google.
- Total of Yahoo and Facebook was definitely higher than that of Google
- None of the above

**Solution:**

Option 5. None of the above

**Explanation:**

No data has been given in the question as to which year amongst the given years in the graph is 2010. Hence this question is incorrect.

*By trial and error method, let us assume all the years one by one to be 2010.*

**Note:**- Revenues of all the three companies are not equal in any of the 6 years and hence option A and B are incorrect.
- Revenues of Google were less than that of Facebook and Yahoo in the first three years mentioned in the graph and hence option C is also incorrect
- Total of Yahoo and Facebook was less than Google in the fifth year shown in the graph and so option D is also wrong.
- If this question needs to be compulsorily answered, then option E, none of the above would be the correct one
- However this doesn’t refute the fact that this question is an incorrect one as data about the regarding which year represents 2010 is not given.
- Hence,
**Option 5**

**Question 2)**

The difference in the average percentage increase in revenues, from 4

^{th}to 6^{th}year, of Yahoo and Facebook is:- 35%
- 40%
- 45%
- 50%
- 55%

**Solution:**

Option 1. 35%

**Explanation:**

- Revenue of Yahoo in 2006 = 1200
- Revenue of Yahoo in 2004 = 250
- So, percentage increase = (950/250) × 100 = 380
- Average percentage increase = 380/2 = 190
- Revenue of Facebook in 2006 = 2000
- Revenue of Facebook in 2004 = 350
- So, percentage increase = (1650/350) × 100 = 235.71
- So, percentage difference in both the values = [(235.71 – 190)/190] × 100 = 24.05
- None of the options are less than 35%, so the question is incorrect.
- However “None of the above” is not one of the given options and hence we will have to take the option closest to 24.05 as the correct answer.
- Hence,
**Option 1.**

**Question 3)**

What would have been Facebook’s revenue (in $ million) in its sixth year of operation if the company had matched Google’s percentage growth in revenues from the fifth to the sixth year?

Choose the option that is nearest to the answer.

- 1600
- 1700
- 1900
- 2100
- None of the above

**Solution:**

Option 1. 1600

**Explanation:**

- Percentage increase in Google’s growth between 5
^{th}and 6^{th}year = (3250 – 1500)/1500 × 100 = 116.67 - So, required value of Facebook revenue after 6th year = 750 × 216.67 = 1625.05
- So, the closest answer is 1600.
**Hence, Option 1.**

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