Discussion

If the income of both companies in 2020 was equal, what was the ratio of their expenditures (X:Y)?

Answer: B

Let the equal income be I. Let expenditures be E_X and E_Y.

For X in 2020, Profit=50%. So, I = E_X(1+0.50) = 1.5 E_X.

For Y in 2020, Profit=55%. So, I = E_Y(1+0.55) = 1.55 E_Y.

Therefore, 1.5 E_X = 1.55 E_Y.

The ratio E_X / E_Y = 1.55 / 1.5 = 155 / 150 = 31 / 30.

The ratio is 31:30.

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