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Bubbles CAT 2024 Graph G Strategy

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Question 1 of 4

Q1CAT 2024✓ Answer verified
The two plots below give the following information about six firms A, B, C, D, E, and F for 2019 and 2023. PAT: The firm’s profits after taxes in Rs. crores, ES: The firm’s employee strength, that is the number of employees in the firm, and PRD: The percentage of the firm’s PAT that they spend on Research and Development (R&D). In the plots, the horizontal and vertical coordinates of point representing each firm gives their ES and PAT values respectively. The PRD values of each firm are proportional to the areas around the points representing each firm. The areas are comparable between the two plots, i.e., equal areas in the two plots represent the same PRD values for the two years.
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Q. 1 Assume that the annual rate of growth in PAT over the previous year (ARG) remained constant over the years for each of the six firms. Which among the firms A, B, C, and E had the highest ARG?

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