This question is from GMATPrep. I've amended the quote above to reflect the true wording of the question.Akansha wrote:A construction company was paid a total of $500,000 for a construction project. The company's only costs for the project were for labor and materials. Was the company's profit for the project greater than 150,000?
(1) The company's total cost was three times its cost for materials.
(2) The company's profit was greater than its cost for labor.
OA is C
Let L = Labor, M = Materials.
Total Cost = L+M.
To make the math easier:
Let Revenue = 500, Desired Profit = 150.
Actual Profit = Revenue - Cost = 500 - (L+M).
For the Actual Profit to be greater than the Desired Profit of 150:
500 - (L+M) > 150.
L + M < 350.
Question rephrased: Is the total cost of L+M < 350?
Statement 1: Total Cost=3M.
L+M = 3M
L=2M.
No way to determine whether L+M<350.
Insufficient.
Statement 2: The profit was greater than its cost for labor.
500 - (L+M) > L
500 - L - M > L
2L+M < 500.
No way to determine whether L+M<350.
Statements 1 and 2 combined: L=2M and 2L+M<500.
Substituting L=2M into 2L+M<500, we get:
2(2M) + M < 500.
5M < 500.
M < 100.
Since M<100, and Total Cost=3M, we know that Total Cost < 300.
Sufficient.
The correct answer is C.
