medium · GMAT Verbal

In the nation of Veridia, the total number of luxury cars sold increased by 20% last year. However, during that same period, the total revenue generated from luxury car sales in Veridia decreased by 10%.

Which of the following, if true, best explains the apparent discrepancy?

  1. Most luxury car buyers in Veridia now choose to take out long-term financing plans rather than paying the full sticker price upfront in cash.
  2. The total number of luxury car dealerships operating across Veridia grew by roughly 25% over the course of the past full year.
  3. The average price of a luxury car sold in Veridia fell by 30% as an influx of more affordable entry-level models reshaped the market.
  4. Several premium manufacturers rolled out unusually aggressive nationwide advertising campaigns throughout Veridia over the year.
  5. Veridia's national government raised the sales tax that it applies to all high-end passenger vehicles at the start of the calendar year.

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