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CAT 1996 | Question: 114

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Let the initial price be 'P' and initial sales be 'S'

So, the initial revenue C = P*S

Now,

Pnew = 1.3P and Snew = 0.8S

$\therefore$ Cnew = Pnew*Snew = 1.3P*0.8S = 1.04C

So, there is a 4% increase in total revenue.

C is the answer.

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