If 5.0 million units are sold and the ASP increases from $200 to $225 while volume remains constant, what is the percent growth in revenue due to price alone?

• A. 10%
• B. 12.5%
• C. 15%
• D. 20%

Answer: (B)

When volume is unchanged, revenue moves only with price because revenue equals price times quantity. Here, quantity stays at 5.0 million, so the revenue growth equals the percent rise in price.

The price increases from 200 to 225, which is a 25 increase on a base of 200. That percent change is 25/200 = 0.125 = 12.5%. So revenue grows by 12.5%.

You can also check with the numbers: initial revenue = 5.0 × 200 = 1,000; new revenue = 5.0 × 225 = 1,125; growth = (1,125 − 1,000) / 1,000 = 0.125 = 12.5%.

Other options would correspond to other price increases (e.g., a 10% rise would be from 200 to 220, a 15% rise to 230, etc.), not the 12.5% produced by moving from 200 to 225.