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Last month, all units of product X produced by a certain com

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bounce87 Junior | Next Rank: 30 Posts Default Avatar
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Last month, all units of product X produced by a certain com

Post Fri Sep 22, 2017 8:58 pm
Elapsed Time: 00:00
  • Lap #[LAPCOUNT] ([LAPTIME])
    Last month, all units of product X produced by a certain company sold out and the company's total cost were equal to $90000 plus 10 percent of the company's total revenue from all units of product X sold. If the company made a profit on product X last month , was the unit price of product X sold greater than $5 ?

    1. The company’s total costs of all units of X product sold were $120,000.

    2. The number of all Units of product X sold last month is less than 20000.

    I didn't understand how the second statement is sufficient.
    Is this correct? pq > 90000 + pq/10. But it is also given that q<20000.
    Please explain!

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    Post Mon Sep 25, 2017 12:45 am
    bounce87 wrote:
    Last month, all units of product X produced by a certain company sold out and the company's total cost were equal to $90000 plus 10 percent of the company's total revenue from all units of product X sold. If the company made a profit on product X last month , was the unit price of product X sold greater than $5 ?

    1. The company’s total costs of all units of X product sold were $120,000.

    2. The number of all Units of product X sold last month is less than 20000.

    I didn't understand how the second statement is sufficient.
    Is this correct? pq > 90000 + pq/10. But it is also given that q<20000.
    Please explain!
    Say Total cost = C, and total Revenue is R

    Thus,

    C = 90,000 + 10% of R

    C = 90,000 + R/10 ---(1)

    Statement 1: The company’s total costs of all units of X product sold were $120,000.

    C = 120,000

    Thus, from (1), we get

    120,000 = 90,000 + R/10

    R = $30,000

    We do not know the number of units, thus, we cannot ascertain if the unit price of product X sold greater than $5. Insufficient.

    Statement 2: The number of all units of product X sold last month is less than 20,000.

    We have C = 90,000 + R/10 and we know that the profit was made, thus, R > C

    Thus, R > 90,000 + R/10

    9R/10 > 90,000

    R > 100,000

    Say the number of all units of product X sold last month is 20000.

    Thus, unit price of product X sold = R/20000 > 100,000/20,000 > 5.

    Since 100,000 divided by 20,000 is 5, thus 100,000 divided by a number less than 20,000 must be greater than 5. Sufficient.

    The correct answer: B

    Hope this helps!

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    Post Mon Sep 25, 2017 3:38 pm
    Hi bounce87,

    What is the source of this question? I ask because the prompt you've posted is almost identical to this Official Guide Question:

    http://www.beatthegmat.com/a-certain-company-og13-t116753.html

    But it appears that someone has moved the 'pieces' of the prompt around and changed the prompt slightly (although it has the same correct answer).

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