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The profit from the sale of a certain appliance increase

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jjjinapinch Senior | Next Rank: 100 Posts Default Avatar
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The profit from the sale of a certain appliance increase

Post Mon Jul 31, 2017 6:47 am
The profit from the sale of a certain appliance increases, though not proportionally, with the number of units sold. Did the profit exceed $4 million on sales of 380,000 units?
(1) The profit exceeded $2 million on sales of 200,000 units.
(2) The profit exceeded $5 million on sales of 350,000 units.

Official Guide question
Answer: B

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Post Mon Jul 31, 2017 11:40 pm
jjjinapinch wrote:
The profit from the sale of a certain appliance increases, though not proportionally, with the number of units sold. Did the profit exceed $4 million on sales of 380,000 units?
(1) The profit exceeded $2 million on sales of 200,000 units.
(2) The profit exceeded $5 million on sales of 350,000 units.

Official Guide question
Answer: B
The key to this question is how you interpret, "The profit from the sale of a certain appliance increases, though not proportionally, with the number of units sold."

The phrase, though not proportionally is useful to understand Statement 1.

Statement 1:

We are told that 'The profit exceeded $2 million on sales of 200,000 units,' thus the profit would exceed 2*2 = $4 million on sales of 2*200,000 = 400,000 units > 380,000 units, had the profit increased proportionally with the number of units sold; however it is not so. The profit at 380,000 units may exceed $4 M or may fall short of $4 M. Insufficient.

Statement 2:

Since the profit exceeded $5 million on sales of 350,000 units, upon the sales of 380,000 units, it would be more than $5 M > $4 M. We need not be bothered how much would that value be; we are sure that it would be more than $4 M. Sufficient.

The correct answer: B

Hope this helps!

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Post Mon Jul 31, 2017 7:01 am
jjjinapinch wrote:
The profit from the sale of a certain appliance increases, though not proportionally, with the number of units sold. Did the profit exceed $4 million on sales of 380,000 units?
(1) The profit exceeded $2 million on sales of 200,000 units.
(2) The profit exceeded $5 million on sales of 350,000 units.

Official Guide question
Answer: B
Target question: Did the profit exceed $4 million on sales of 380,000 units?

Given: The profit from the sale of a certain appliance increases, though not proportionally, with the number of units sold.
IMPORTANT: This means that we CANNOT make any "good" assumptions about the profits from sales other those presented in statements 1 and 2. All we know FOR CERTAIN is that increased unit sales means increased profits. That's it.

Statement 1: The profit exceeded $2 million on sales of 200,000 units.
The given information (about profits NOT being proportional) means that the ONLY conclusion we can draw here is that the profit from the sale of 380,000 units must be greater than $2 million. That's it.
So, the profit from the sale of 380,000 units could be greater than $4 million or less than $4 million.
Since we cannot answer the target question with certainty, statement 1 is NOT SUFFICIENT

Statement 2: The profit exceeded $5 million on sales of 350,000 units.
From the given information, we can conclude (with certainty) that the profit from the sale of 380,000 units must be greater than $5 million.
This means that the the profit from the sale of 380,000 units DEFINITELY exceeded $4 million
Since we can answer the target question with certainty, statement 2 is SUFFICIENT

Answer = B

Cheers,
Brent

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