Student discount price: $4
Normal price: $7
Multiple Choice Question: If the club offered no discount for students and consequently the number of students attending dropped by 10%, what would be the new revenue created for Jan?
Choice of answers:
Correct answer is D. I have been trying for hours to solve this problem!!
I have no idea how they got D.
This is what i've tried:
So, students have dropped by 10%. I assume they mean 10% per month. Therefore, for Jan we now have 0.9 * 14000 = 12600 student sales.
But we have 8000 "normal sales", who already pay full price ($7).
Therefore, the new revenue for Jan should be:
($7 * 8000) + ($7 * 12600) = $144,200
Now, I assume the answer they want doesn't take into account the "old" revenue, ie. the revenue that would already occur before taking away the discount anyway. This would be: ($7 * 8000) + ($4 * 14000) = $112,000
Therefore, the new revenue generated by the removal of the discount would be: $144200 - $112000 = $322,000.
But this isn't in the choice of answers! So how did they get choice D? Does anyone know? Thanks!