# Senior business analyst Interview Questions

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Senior Business Analyst interview questions shared by candidates### The company is losing 1 million subscribers every month. What are the possible reasons for losing subscribers? Given the company is losing subscribers at this pace, how long can the company continue, until it starts making loss?

10 Answers↳

25 months

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12Bn Rev Per year 9BN cost per year Customer Loss per year = 1million *12 months = 12 million customers Revenue per customer per year = 36 + 7*12 = $120 Each year, company looses 1.44BN. = (12 million *120) To make a loss, company must loose 3BN 3BN/1.44BN = 2.083 years 2.083 years = 25 months. Less

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25 months doesn't sound right... Revenue: $12 billion Costs: $9 billion Profit: $3 billion Customer lost/month = 1 million Revenue lost/month = (36/12 + 7) = $10 * 1 million = $10 million Break even = $3 billion / $10 million = 300 months 300 months / 12 = 25 years The only way I can see 25 months is if we assumed Ad Revenue is Annual and CANNOT be broken down to month average/customer. In that case Annual Revenue/Customer = 36 + (7 *12) = $120/customer Total lost revenue/month = 120 * 1 million = 120 million Breakeven = 3 billion / 120 million = 25 months Less

### Given the company forms a partnership with Hulu. The subscription fee is $2 per customer per month and ad revenue is $3 per customer per month, for additional customers. Hulu has 50 million subscribers and the adoption rate is 20%. How will this affect the company? How long can the company last without making loss?

5 Answers↳

I think there is enough information. We know from the previous question, their programming rights and contest cost 9Bn. Maybe they'd increase with the Hulu subscription. But assuming they stay the same, the business can last 30 months. Hulu has 50 M subscribers, adoption rate is 20% So, 10 million customers will sign up for this service Subscription fee is 2 per customer per month 2X12= 24 per year 24X10M= 240M in subscription fees per year Ad revenue is 3 per customer per month 3X12=36 per year 36X10M= 360M in ad revenue per year 240M+360M=600M in total revenue from Hulu partnership On a per month basis revenue from Hulu is 50M 750M in costs per month We know that once they reach 75M customers, they stop making a profit, and only break even. This is in month 25 Considering the monthly costs of 750M and the 50M in Hulu subscription revenue, we knows that once their revenue is 700M, they’ll no longer be making a profit. When their monthly revenue is 700M, they have 70M customers You can also set up an equation to determine the period when they’ll no longer net a profit X+50M=750M X=700M They’ll have 70M customers in month 30th So, the business can last until month 30th Less

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How do you calculate that they will have 70m customers in month 30

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Doesn't seem to be enough data here.... Time period? Costs?

### Be prepared to answer questions on your previous work. Also, Deloitte pays maximum importance to communication skills. Good communication skills can get you through the interview process with ease.

4 Answers↳

Hi , How much time they took from 1st round of interview to Final offer letter ?? I have also given interview for the same profile(Workday) and i m selected for 2nd round Ca you please share your experience with Senior manager?? is it Technical or Hr type ?? Regards, Sumit Less

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Hi , How much time they took from 1st round of interview to Final offer letter ?? I have also given interview for the same profile(Workday) and i m selected for 2nd round Ca you please share your experience with Senior manager?? is it Technical or Hr type ?? Regards, Sushil Less

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Hi , How much time they took from 1st round of interview to Final offer letter ?? I have also given interview for the same profile(Workday) and i m selected for 2nd round Ca you please share your experience with Senior manager?? is it Technical or Hr type ?? Regards, Sumit Less

### Lotteries are typically run by government agencies. Governments often use the funds for public school education, etc. 1. Why might people buy a lottery ticket? The lottery has 3 prize levels and when you buy a ticket you are put in contention for all 3 prize levels Odds: 1st : 1 in 10 million, the prize is 1 million 2nd :1 in 1000, the prize is 200 3rd :1 in 10, the prize is 5 dollars 2 million tickets are sold Tickets cost 2 dollars to buy 4 million in revenue from ticket sales 2. On average, how much should an individual expect to win from the lottery? 3. Is buying the lottery ticket a good deal for consumers? 4. How can the lottery attempt to sell more tickets? Let’s say, the lottery modifies its prize structure They decide to add an additional 4 million in prize money, split between the 2nd and 3rd options. This money is split collectively between all winners 1st :1 in 10 million, the prize is 1 million 2nd :1 in 1000, the prize is 200. There is also a 2 million prize which will be split collectively between the winners 3rd :1 in 10, the prize is 5 dollars. There is also a 2 million prize which will be split collectively between the winners 5. What is the collective value of a ticket now? 6. How many additional tickets does the lottery have to sell to break even on the money they put toward the new prizes? Assume, they’ve already broken even on the cost of the other lottery prizes. 7. Is it viable to sell that amount of additional tickets?

4 Answers↳

Correct on the first question, start getting wrong on the second the third. For 2nd question, you already know the lottery has to pay $0.8 on average to every buyer, so after adding additional 4 million to the prize( this part stays fixed as no matter how many tickets sold), the collective should be a function of number of tickets sold: 0.8n+4 million. In this case, 2 million tickets sold, that's 0.8*2 million + 4 million=5.6 million in total collective value. For a single ticket is 5.6 million divided by 2 million tickets sold, is $2.8. From that we can go to the third question. Both cost(prize to pay to winners) and revenue are functions of tickets sold, where cost = 0.8n+4million, and revenue = 2n. The breakeven point is cost equals to revenue, when n equals to 3.33 million. Currently 2 million tickets sold, so we need to sell 1.33 million more tickets to cover the potential cost. To see if it's viable to sell 1,33 million more tickets is an open-ended question, just name several factors to consider: economy cycle, local income&spending power, advertisement, retail panel and like. Less

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I think a lot of the challenges have to do with the wording of the question. To me, if we assume they have already broken even on previous lottery costs, we are a point where profit is currently zero. My interpretation of the question is how many additional tickets do we need to sell to cover the 4 million, which is essentially a fixed cost seeing as regardless of how many winners there are, the cost to the lottery remains at 4 million. With previous lotteries costs paid for, we don't have to consider them. However, all NEW tickets sold will still cost the lottery business 80 cents on average, making this a variable cost. We know revenue per ticket is $2. Each ticket provides a profit of $1.20 (2 - .80). Thus we setup the breakeven equation with x being the number of tickets needed to reach breakeven. 1.20x - 4,000,000 = 0 1.20x = 4,000,000 x = 4,000,000/12 x = 3,333,334 tickets (rounded up 1 since we can't sell partial tickets So we would need to sell an additional 3.33 million tickets to breakeven on the 4M in new prizes. Less

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This is how I solved the questions. The answers are all correct. 2. 1st : 1 in 10 million, the prize is 1 million 1/10 mill X 1 mill=0.1 2nd :1 in 1000, the prize is 200 1/1000(200)=0.2 3rd :1 in 10, the prize is 5 dollars 1/10(5)=0.5 0.1+0.2+0.5 =0.8 On average consumers should expect to win 80 cents 5. 2nd prize 2 million buyers 1/1000(2 million buyers)= 2000 So, there will be 2000 winners. Divide 2 mill by number of winners to determine how much each of them win 2,000,000/2000 The value of the 2 million jackpot is 1000 3rd prize 2 million buyers 1/10(2 million buyers) There will be 200,000 winners. Divide 2 mill by the number of winners to determine how much each of them win 2,000,000/200,000 The value of the 2 million jackpot is 10 Add in the other prizes, to get the total value 1st 1 million 2nd 1000+200 =1200 3rd 10+5 =15 1 mill+1200+15 =1,001,215 The collective value of the ticket is 1,001,215 6. 4 mill was spent on the lottery Tickets cost 2 dollars 2X=4 mill __ __ 2 2 X=2 mill So, 2 mill additional tickets need to be sold Less

### What is the CAISO? How does PG&E make money?

3 Answers↳

decoupling and investor ownership

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CAISO: California Independent System Operator/ how they make money: decoupling and investor ownership Less

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Yeah it sounds like really simple questions. The problem was this was after 5 hours of interviewing/talking and at that point I had reached my mental exhaustion limit. I was able to answer it but it wasn't exactly the most well put answer. Less

### Cap One is usually collects default accts by calling these customers. Usually 15% of customers pay their accounts off. Now, they are consdering giving an offer to the customers for paying 60% amount. Should we do that or not. Abg balance is $2000. This offer will impact now, that only 10% customers will pay in full and 10% will pay 60% offer. part(b)- since we are stealing our own customers by giving an offer, what is the cannibalization rate? and what is the max. cannibalization rate that Capital One can do to break even?

3 Answers↳

i don't understand. what is the base of 15% to pay accounts off? how much off? what offer is it? what's the motivation? what does 10% pay in full and 10% pay in offer mean? why are we stealing our own customers? Less

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Assume that the base is 100. Initial scenario: a) 15% pay off @ 2000 (USD) => 15%*100*2000 =>30000 New scenario a) 10% pay off @ 2000 (USD), and 10% pay off @ 60% => 10%*100*2000 + 60%*10%*100*2000 =>32000 The firm stands to make more money with the revised scenario. I am not sure what the cannibalization has to do here, but the firm needs to get a rate of 50% paying under the scheme to be breaking even. (Assuming that the original 10% will stay). Less

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Assume we have 100 people as base cannibalization rate= Unit Loss of old product / unit sales of new product In our case = (15%100-10%100)/10%*100 = 5/10=50% Break-even Cannibalization Rate Profit from sales of new product = profit stolen from old (In our case, we do not have a cost, we only have revenue, let's assume revenue is our profit) Assume we still X number of ppl from old plan 10%*60%*2000*100=10%*X*2000 12000=200*X X=6 So when we steal 6 people from old plan, we will break even. Thus the maximum cannibalization rate will be 6/10=60% Less

### Ok now assume that the day is split into surge and non-surge demand hours. Non-surge demand lasts 4 hours and has 800 rides. Surge demand lasts another 4 hours and has 1,600 rides. Assume you can only hire drivers for the full day. How much would you need to charge during surge hours to breakeven on your profit from the first question?

3 Answers↳

Above answer is correct: need to charge $38.75 per ride.

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I believe it was $56.25. There were 120 drivers needed

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1,600 surge rides/4 hours/5 rides per hour = 80 drivers needed 20,000 = ($30*800)+($X*1,600)+(-$700*80)+(-10,000) Solve for $X price. I got $38.75 but I didn't get invited to the next round so i really don't know... Less

### The company manufactures 3D Printers. Who should they target selling it to and which one will be more profitable? End customers directly or through retailers? Interviewer asked me to plot graph to show the volume of sales with respect to time for each scenario. Asked to calculate the profit in 2years giving fixed cost 6.6m, over head costs 2.4m/yearly, cost of the item=$250 price of the item sold=$500 and no of units= 2000/monthly. Altered the numbers: when 25% of printers breakdown and cost of repairing each one is 200$. What are the additional printers to be sold to make the profit in 1 year?

3 Answers↳

2000 is correct for 2nd part

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Q1: Revenue = $500/unit x 2000 units/mo x 24 mos = $24M Cost = $6.6M + $2.4M/year x2 years + $250 x 2000 units/mo x 24 mos = $23.6M Profit = $0.6M Q2: Question is how many additional units do I have to produce to make the same profit as I did previously in just 1 year but with the added cost of repairing 25% of my units at $200 per unit. Let's say I have to produce X units per month now. New Revenue = $500/unit x X units/mo x 12 mos = 6000X New Cost = $6.6M x $2.4M/yr x 1year + [250x12xX - 200x12xXx25%] = $9M + 3600X Setting $0.6M = New Rev - New Cost = 6000X - $9M+3600X Solving for X = 4,000 units monthly So I have to make an additional 2,000 units per month to have the same profit in the first year. Less

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Total Rev = $250 ( $500 - $250) x (2000 x 12months) = $6 M/year Total Cost = Fixed + Var = $9M/year Profit = T.Rev - T. Cost = $-3.0M/year (loss) Qns 2) Variable Cost per unit 2,400,000 = 24,000 units x Z( which is VC per unit) so Z = $100 per unit Therefore Break even units = $6.6M / ($500(Selling Price) - $100(V.Cost)) =16,500 units Added FC from repairs is $1.2M ( 25% of 24,000 units x $200 per unit) This is Sunk cost and additional So New Breakeven = $6.6M + $1.2M/(500 - 100) which is the Contributions Margin per unit 19,500 units for BE with additional costs Additional Units is 3000 units (19,500 - 16,500) Less

### Anti-freeze: planning to buy a company with 12.5 in cash, 10% bonds for the remaining amount. Total worth of the company $137.5. assuming there is no discount rate. When will u break-even. And is it a good buy? Part(2) - Anti-freeze is currently priced at $8, with 60% market share; there are other products in the market(A) priced at $7 with 15% market share, (B) at $7 with 7% market share and (c) with $5 and 10% market share. Should we consider decreasing our price by $1 or NOT?

3 Answers↳

Hi, do you mind post the answer as well? Appreciate it.

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What are we breaking even with ? The 12.5 cash investment ? How much cash flow does the new product generate ? Less

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breakeven: you paid 12.5 today, and 137.5 in future, and no interest rate, so you have to make 150 to break-even. pricing: have to have cost and volume, and historical data of price elasticity. If not, use breakeven analysis. assuming total market volume remains as price drops, and that this price elasticity takes into consideration of all factors including dynamics of market share rebalance and volume change to this company only, set price elasticity to be x, cost to be c, total volume to be V, we have (8-c)*0.6V = (7-c)*0.6V*(1-x/8), x=(c-7)/8, if absolute value of price volatility is larger than this, we decrease price. Less