GMAT Focus EditionData InsightsEasy
A data analyst is examining sales data for a retail company across three regions: North, South, and Central. The table below shows the total sales revenue and the number of transactions for each region in the last quarter. | Region | Total Sales Revenue ($) | Number of Transactions | |---|---|---| | North | 1,200,000 | 15,000 | | South | 900,000 | 12,000 | | Central | 1,500,000 | 20,000 | The company defines 'average transaction value' as the total sales revenue divided by the number of transactions. Which region has the highest average transaction value, and what is that value?
- ANorth, $75.00
- BNorth, $80.00
- CSouth, $75.00
- DCentral, $75.00
Show answer & explanationAnswer & explanation
Correct answer: B. North, $80.00
To find the average transaction value for each region, divide the Total Sales Revenue by the Number of Transactions. Then, compare these values.
Why the other options are wrong
- A. North's average transaction value is $80.00, not $75.00. This option is incorrect.
- C. South: $900,000 / 12,000 = $75.00. This is lower than North. This option is incorrect.
- D. Central: $1,500,000 / 20,000 = $75.00. This is lower than North. This option is incorrect.
Average Transaction Value
Average Transaction Value (ATV) is a metric that measures the average amount of money a customer spends per transaction in a business.
- Calculated as Total Revenue / Number of Transactions.
- Used to understand customer spending habits and optimize sales strategies.
- A higher ATV often indicates more profitable transactions.
Memory trick: Average transaction is how much each customer spends, on average, per visit.