There are only four brands of entry level smartphones called Azra, Bysi, Cxqi, and Dipq in a country.
Details about their market share, unit selling price, and profitability (defined as the profit as a percentage of the revenue) for the year 2016 are given in the table below:
In 2017, sales volume of entry level smartphones grew by 40% as compared to that in 2016. Cxqi offered a 40% discount on its unit selling price in 2017, which resulted in a 15% increase in its market share. Each of the other three brands lost 5% market share. However, the profitability of Cxqi came down to half of its value in 2016. The unit selling prices of the other three brands and their profitability values remained the same in 2017 as they were in 2016.
Question No. 1:
The brand that had the highest revenue in 2016 is:
Options:
- Dipq
- Bysi
- Cxqi
- Azra
Question No. 2:
The brand that had the highest profit in 2016 is:
Options:
- Azra
- Bysi
- Cxqi
- Dipq
Question No. 3:
The brand that had the highest profit in 2017 is:
Options:
- Dipq
- Bysi
- Cxqi
- Azra
Question No. 4:
The complete list of brands whose profits went up in 2017 from 2016 is:
Options:
- Azra, Bysi, Cxqi
- Bysi, Cxqi, Dipq
- Cxqi, Azra, Dipq
- Azra, Bysi, Dipq
Question 1:
Let the total market size be 100 units. The sales of Azra, Bysi, Cxqi and dipq would be 40, 25, 15 and 20 units respectively.
The revenue would be as follows
Azra = 40 x 15,000 = 6.0 lac
Bysi = 25 x 20,000 = 5.0 lac
Cxgi = 15 x 30,000 = 4.5 lac
Dipq = 20 x 25,000 = 5.0 lac
The brand with the highest revenue is Azra.
Ans : Azra
Question 2:
The profits for the different brands, assuming revenue as in the previous question would be
Azra $- 6.0$ lac $\times \frac { 10 } { 100 } = 60,000$
Bysi $- 5.0$ lac $\times \frac { 30 } { 100 } = 1,50,000$
Cxgi $- 4.5$ lac $\times \frac { 40 } { 100 } = 1,80,000$
Dipq $- 5.0$ lac $\times \frac { 30 } { 100 } = 1,50,000$
The profit is the highest for Cxqi
Ans : Cxqi
Question 3:
The new market share, selling prices and profitability for the different brands are
Now the total sales is 140 units.(Increase of 40%) The profits are as follows
Azra $- 49 \times 15,000 \times \frac { 10 } { 100 } = 73,500$
Bysi $- 28 \times 20,000 \times \frac { 30 } { 100 } = 1,68,000$
Cxgi $- 42 \times 18,000 \times \frac { 20 } { 100 } = 1,51,200$
Dipq $- 21 \times 25,000 \times \frac { 30 } { 100 } = 1,57,500$
The profit is the highest for Bysi
Ans : Bysi
Question 4:
The profits increased for Azra (60,000 – 73,500) for
Bysi (1,50,000 – 1, 68,000) and Dipq (1,50,000 –
1,57,500)
Ans : Azra, Bysi, Dipq
Online CAT LRDI Course @ INR 3999 only