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If Chris saved $ 400 of his earnings last month, how much...

This topic has 1 expert reply and 0 member replies

If Chris saved $ 400 of his earnings last month, how much...

Post Tue Nov 07, 2017 10:58 am
If Chris saved $ 400 of his earnings last month, how much did Chris earn last month?

1) Chirs spent 1/3 of his last month's earnings on rentals saved 1/4 of the reaminder.
2) last month, Chris paid three times as much in loan payments as he saved.

The OA is A.

Please, can any expert explain this DS question for me? I have many difficulties to understand why that is the correct answer. Thanks.

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GMAT/MBA Expert

Post Tue Nov 07, 2017 7:34 pm
Hi swerve,

We're told that Chris saved $400 of his earnings last month. We're asked for the total amount Chris EARNED last month.

1) Chris spent 1/3 of his last month's EARNINGS on rentals and saved 1/4 of the remainder.

Fact 1 tells us that 1/4 of 2/3 of Chris's earnings were saved. We can combine this information with what we were told in the prompt (that Chris Saved $400) and 'work backwards' to find the total earned.

$400 = 1/4 of the 'remainder'
$1600 = the 'remainder'

the 'remainder' = $1600 = 2/3 of the total earned
$1600 = (2/3)(X)
$2400 = X
Thus, Chris earned $2400, spent 1/3 of that (re: $800) on rentals and had a 'remainder of $2400-$800 = $1600. He saved 1/4 of that remainder (which matches the $400 that the prompt stated was the savings).
Fact 1 is SUFFICIENT

2) Last month, Chris paid three times as much in loan payments as he saved.

With Fact 2, we can determine the amount of money that Chris spent on loan payments (3 times $400 = $1200), but we don't know if Chris spent money on anything ELSE. Fact 2 ultimately tells us that Chris earned AT LEAST $1200+$400 = $1600, but he could have earned more than that.
Fact 2 is INSUFFICIENT

Final Answer: A

GMAT assassins aren't born, they're made,
Rich

_________________
Contact Rich at Rich.C@empowergmat.com

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