sandy wrote:
For a certain farm, soybean production increased by 25 percent from year X to year Y, and the selling price of soybeans decreased by 25 percent from year X to year Y. If the entire soybean production was sold each year, approximately what was the percent change in the revenues from the sale of the soybeans from year X to year Y?
A. 56% decrease
B. 6% decrease
C. no change
D. 6% increase
E. 56% increase
We can assume 100 tons of soybeans were produced in year X, and the selling price of soybeans is $100 per ton. So in year Y, the soybean production was 125 tons but the selling price was $75 per ton.
We can see that in year X, the revenue was 100 x 100 = $10,000 and in year Y, the revenue was 125 x 75 = $9,375. We see that this is approximately a 6% decrease (if it were exactly a 6% decrease, the revenue in year Y would be $9,400).
Answer: B
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