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Data Context 2
Price Indices
Price of Corn
Year
A: $744.86
1$
400
3.10%
2$
415
3.50%
3$
420
2.20%
4$
450
5.50%
5$
510
4.10%
6$
590
6.20%
B: $567.89
C: $652.65
D: $788.78
E: $444.12
Solution:
Calculate the compounded price growth of corn for the 4 years (from 6 th to 10th year), then multiply Year 6 price
by this number.
From 6th year through 10th year there would be 4 years. Using standard formula (1+6%)^4 = 1.26248
1.26 (compounded price growth rate) x 590 (Year 6 price) = 744.86
Price of Corn
Year
(31-Dec)
(1-Jan 31-Dec)
1$
400
3.10%
2$
415
3.50%
3$
420
2.20%
4$
450
5.50%
5$
510
4.10%
6$
590
6.20%
Data Context 8
Comparing Several Companies
billions $
20
22.02
23.92
23.61
22.54
15
10
12.43
13.33
2006
2007
19.22
15.68
16.75
2009
2010
18.53
17.58
WPP
The rest
14.68
A: 2006-2007
B: 2007-2008
2008
C: 2008-2009
2011
D: 2009-2010
E: 2010-2011
Solution:
First of all, understand the question and look for clues in the graph. For example, percentage share of global sales
means that you need to calculate the ratio of WPP sales to the total sales (including WPP), for each year. Then you
need to identify where this percentage has fallen from the previous year. The problem is that 1 minute would not be
sufficient to calculate the above percentage shares of WPP for each of the 6 years! See Shortcut method below.
Traditional method would be to calculate WPP market share as % of total market for each year (as follows).
2006: 22.54 / (22.54 + 12.43) = 64.46%
2007: 23.61 / (23.61 + 13.33) = 63.91%
2008: 22.02 / (22.02 + 14.68) = 60%
2009: 23.92 / (23.92 + 15.68) = 60.4% - an increase from 2008
Shortcut:
The graph comes with an answer. Notice that the trend
for The Rest of the world is up while WPP trend is
down with an upward spike in 2008-2009 period.
The task is to identify the period where WPP market
share increased from the previous year. WPP actual
sales increased from 2008 to 2009. Hence, 2008 and
2009 would be the best data points to start with - to
save a lot of time! If you dont have time to calculate
you could just choose 2008-2009 period from the
graph.
Indeed, 23.92 / (23.92 + 15.68) = 60.4% which is an
increase from 22.02 / (22.02 + 14.68) = 60%
Tip: Look for clear trend changes and noticeable
spikes in linear graphs for quick answers.
Task:
22.02
22.54
23.61
15
10
12.43 13.33
14.68
23.92
19.22
15.68
16.75
2009
2010
18.53
17.58
The rest
5
2006
2007
2008
WPP
2011
Data Context 4
Pie charts with value components
Brazil
5%
China
10%
India
9%
Russia
12%
UK
39%
A: 11.7%
B: 12.5%
C: 10.1%
D: 9.9%
E: 9.5%
The key task is to calculate the value that will move from China holding to India holding. Then add it to the actual
value of existing India holding, then divide the sum by the total value of the Fund.
Total value of China holding: 210m x 10% = 21m
11% of China holding: 21m x 11% = 2.31m
Total existing value of India holding: 210m x 9% = 18.9m
Total new value of India holding: 18.9m + 2.31m = 21.21m.
Percentage representation: 21.21m / 210m = 10.1%
UK
39%
India
9%
Russia
12%
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