A reatil appliance store priced a video recorder at 20

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AAPL: Moderator; Posts: 2599; Joined: Sun Oct 29, 2017 2:08 pm; Followed by:2 members

A reatil appliance store priced a video recorder at 20

by AAPL » Fri Nov 16, 2018 4:38 am

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GMAT Paper Tests

A retail appliance store priced a video recorder at 20 percent above the wholesale cost of $200. If a store employee applied the 10 percent employee discount to the retail price to buy the recorder, how much did the employee pay for the recorder?

A. $198
B .$216
C. $220
D. $230
E. $240

OA B.

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Source: Beat The GMAT — Problem Solving | Fri Nov 16, 2018 4:38 am

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Brent@GMATPrepNow: GMAT Instructor; Posts: 16207; Joined: Mon Dec 08, 2008 6:26 pm; Location: Vancouver, BC; Thanked: 5254 times; Followed by:1268 members; GMAT Score:770

by Brent@GMATPrepNow » Fri Nov 16, 2018 7:02 am

AAPL wrote:A retail appliance store priced a video recorder at 20 percent above the wholesale cost of $200. If a store employee applied the 10 percent employee discount to the retail price to buy the recorder, how much did the employee pay for the recorder?

A. $198
B .$216
C. $220
D. $230
E. $240

A retail appliance store priced a video recorder at 20 percent above the wholesale cost of $200
20% of $200 = $40
So, the retail price = $200 + $40 = $240

If a store employee applied the 10 percent employee discount to the retail price to buy the recorder, how much did the employee pay for the recorder?
10% of $240 = $24
So, the discounted price = $240 - $24 = $216

Answer: B

Cheers,
Brent

Brent Hanneson - Creator of GMATPrepNow.com

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by [email protected] » Fri Nov 16, 2018 12:50 pm

Hi All,

We're told that a retail appliance store priced a video recorder at 20 percent above the wholesale cost of $200 and a store employee applied the 10 percent employee discount to the retail price to buy the recorder. We're asked for the total price the employee paid for the recorder. The math behind this question can be done in a couple of different ways. You can actually do just a little math - and use the 'spread' of the answer choices to your advantage.

The 20% markup in the wholesale cost can be referred to as (1.2)
The 10% employee discount can be referred to as (0.9), since the employee is paying 90% of the normal retail price.

Thus, the total price paid for the video recorder would be ($200)(1.2)(0.9)

(1.2)(0.9) = 1.08, meaning that the employee paid 8% more than the retail price. Since 10% of $200 = $20, the employee paid a little less than $220. There's only one answer that fits...

Final Answer: B

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

Contact Rich at [email protected]

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swerve: Legendary Member; Posts: 2499; Joined: Sun Oct 29, 2017 2:04 pm; Followed by:6 members

by swerve » Sat Nov 17, 2018 10:09 am

So here, basically we are increasing a number first by 20%, and then decreasing it by 10%. So lets say we start with 100.
Increase 100 by 20% = 120
Decrease 120 by 10% = 120-12 = 108

If you start with 100, you end at 108 (overall 8% increase)
If you start with 200 (double of 100), you will end at 216 (double of 108)

Hence B is the correct answer.

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Scott@TargetTestPrep: GMAT Instructor; Posts: 8086; Joined: Sat Apr 25, 2015 10:56 am; Location: Los Angeles, CA; Thanked: 43 times; Followed by:29 members

by Scott@TargetTestPrep » Sun Mar 31, 2019 10:48 am

AAPL wrote:GMAT Paper Tests

A retail appliance store priced a video recorder at 20 percent above the wholesale cost of $200. If a store employee applied the 10 percent employee discount to the retail price to buy the recorder, how much did the employee pay for the recorder?

A. $198
B .$216
C. $220
D. $230
E. $240

OA B.

We are given that a retail appliance store priced a video recorder at 20 percent above the wholesale cost of $200, or 1.2 x 200 = $240.

If an employee purchased the item at a 10 percent discount, he paid 0.9 x 240 = $216.

Answer: B

Scott Woodbury-Stewart
Founder and CEO
[email protected]