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The profit from the sale of a certain appliance increase

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The profit from the sale of a certain appliance increase

by jjjinapinch » Mon Jul 31, 2017 6:47 am

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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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by Brent@GMATPrepNow » Mon Jul 31, 2017 7:01 am

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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

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Brent
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by Jay@ManhattanReview » Mon Jul 31, 2017 11:40 pm

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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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by [email protected] » Tue Mar 27, 2018 2:42 pm

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Hi All,

We're told that the profit from the sale of a certain appliance increases, though NOT proportionally, with the number of units sold. We're asked if the profit exceeded $4 million on sales of 380,000 units. This is a YES/NO question. This is a great example of a 'concept question', meaning that you don't actually have to do any math to solve it (as long as you understand the concept(s) involved).

1) The profit exceeded $2 million on sales of 200,000 units.

We're told that profit increases, but NOT proportionately as sales increases. Thus, we know that 380,000 units sold would be MORE profitable than 200,000 units sold (thus, the profit would be GREATER than $2 million). However, we don't know how much greater - the profit could be less than $4 million (a 'NO' answer), $4 million exactly (also a 'NO' answer) or greater than $4 million (a 'YES' answer)
Fact 1 is INSUFFICIENT

2) The profit exceeded $5 million on sales of 350,000 units.

With Fact 2, we know that $5 million in profit occurred when 350,000 units were sold, so the profit for 380,000 units WILL be higher than $5 million. Even though we don't know the exact amount that the profit will be, we DO know that it will be GREATER than $5 million - so the answer to the question is ALWAYS YES.
Fact 2 is SUFFICIENT

Final Answer: B

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by Jeff@TargetTestPrep » Mon Jul 30, 2018 10:49 am

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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.
We are given that the profit from a sale of a certain appliance increases with the number of units sold. We need to determine whether the profit is greater than $4 million on sales of 380,000 units.

Statement One Alone:

The profit exceeded $2 million on sales of 200,000 units.

Since the increase in profit with the sales of appliances is not proportional with the number of units sold, statement one does not provide enough information to determine whether the profit exceeded $4 million on the sales of 380,000 units.
Statement Two Alone:

The profit exceeded $5 million on sales of 350,000 units.

Since we know that the profit exceeded $5 million on the sale of 350,000 units, we know that the profit would exceed $5 million and hence exceed $4 million on the sale of 380,000 units. Statement two alone is sufficient to answer the question.

Answer: B

Jeffrey Miller
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