
First step, I can't find the height. How do you find the height?

First step, I can't find the height. How do you find the height?
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HINT : Do you see why the followings hold?
$$\triangle PQR:\triangle MQR=2:1$$ $$\triangle MQR:\triangle SQR=3:2$$ $$\triangle SQR:\triangle MNS=2^2:1^2$$
P.S. For exmaple, since $MQ:SQ=3:2$, we have $\triangle MQR:\triangle SQR=3:2$. Do you see why?
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Hint 1: $\triangle MNS$ is similar to $\triangle QRS$ (why?)
Note that $MN$ is parallel to $QR$ and compare the angles of the two triangles.
Hint 2: You know the ratio of $MN$ to $QR$. Can you then find the ratio of the areas of $\triangle MNS$ and $\triangle QRS$
See Oleg567's comment: if the lengths of the sides are in ratio $a:b$, the the ratio of the areas is $a^2:b^2$.
Hint 3: $$\frac{\triangle MNS}{\triangle PQR} = \frac{\triangle MNS}{\triangle PNM} \frac{\triangle PNM}{\triangle PQR}$$
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This is quite an interesting question. Could you share with us which level or type of test or exam this is from?
If you assume one of the answers must be the correct one, here's a way to see that it can only be (E):
$\triangle SMN$ is similar to $\triangle SQR$ and of half its dimensions, therefore a quarter of its area. $\triangle SQR$ is strictly smaller than $\triangle NQR$, which, because $N$ is the midpoint of $PQ$, is half the area of $\triangle PQR$. The area of $\triangle SMN$ is therefore strictly smaller than one-eight the area of $\triangle PQR$.
The only ratio amongst the proffered answers that meets this condition is the ratio $1{:}12$ of (E).