📊 GMAT Exam Prep

A company's annual report includes a line graph showing 'Gross Revenue' and 'Operating Expenses' over five years (Year 1 to Year 5). 'Gross Revenue' shows a steady upward trend, while 'Operating Expenses' also increased but at a slower rate until Year 4, after which it dipped slightly in Year 5. If Profit = Gross Revenue - Operating Expenses, which of the following is most likely true regarding the company's profit trend?

A Profit consistently decreased each year.
B Profit increased each year, with the highest growth likely in Year 5.
C Profit remained constant across all five years.
D Profit decreased in Year 4, then recovered in Year 5.

✓ Correct Answer: Option B

Gross Revenue steadily increased, and Operating Expenses increased at a slower rate, then dipped in Year 5. This combination would lead to consistent profit increases, with the largest gain potentially in Year 5 due to the expense dip.

Related GMAT Exam Prep Questions