Auto-Grow Ltd., an automobile manufacturing company, tracks its annual car sales (in thousand units) and average selling price per car (in ₹ lakh) over a period of five consecutive years from 2020 to 2024. The company uses a mixed graph where the bar chart represents the number of cars sold and the line graph represents the average selling price per car.
Additional information:
The manufacturing cost per car was constant at ₹2 lakh from 2020 to 2022 and increased by10% each year thereafter.
The company incurred fixed operational costs of ₹100 crore per year.
Profit (or loss) for a year = Total revenue − (Total variable cost + Fixed cost).
Ignore taxes and depreciation.
Calculate the percentage change in profit from 2022 to 2023. (Round off your answer to two decimal places)
Solution
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Percentage change in profits from 2022 to 2023 = $$\frac{196400-190000}{190000}\times\ 100\approx+3.37\%\ $$ i.e. an increase of 3.37%.
