A contruction company was paid a total of 500,000 for a contruction project. The company's only costs for the project were labor and materials. Was the company's profit for the project greater than 150,000 ?
1) The company's total cost was 3 times its cost for materials.
2) The company's profit was greater than its cost for labor.
I tried to solve it and ended up with either a C or E.
Can someone please explain this.
Thanks.
-A
GMAT Word problem
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I think it's a C
Revenues: 500,000
Costs= Labor+Materials
500,000-(L+M)>150,000?
1. L+M=3M=> L=2M
In this case, 500,000-3M>150,000? Going more in depth, we get -3M>-350,000 so M<116000> L
500,000- M> 2L This statement is also insufficient by itself as we do not know how much money was spent on materials or Labor.
The two statements taken together give:
L=2M so 500,000-3M>2M
500,000>5M => M<100,000 Judging by this, the cost of materials was less than 100k. Consequently, Labor was twice as much as Materials so L<200k
and you can answer the question.
You got me curious. Can you check the OA and let me know, please?
Revenues: 500,000
Costs= Labor+Materials
500,000-(L+M)>150,000?
1. L+M=3M=> L=2M
In this case, 500,000-3M>150,000? Going more in depth, we get -3M>-350,000 so M<116000> L
500,000- M> 2L This statement is also insufficient by itself as we do not know how much money was spent on materials or Labor.
The two statements taken together give:
L=2M so 500,000-3M>2M
500,000>5M => M<100,000 Judging by this, the cost of materials was less than 100k. Consequently, Labor was twice as much as Materials so L<200k
and you can answer the question.
You got me curious. Can you check the OA and let me know, please?
I will go for C.
from 1) L + M = 3M
Eq becomes
500,000 = L + M + P
= L + L/2 + P
from 2) P > L and we also know lesser the Labor charges greater the profit.
Lets assume Profit is just equal to L to get break point.
500,000 = L+L/2 + L = 5/2L
L = 200,000
But P > L
So P > 200,000> 150,000
from 1) L + M = 3M
Eq becomes
500,000 = L + M + P
= L + L/2 + P
from 2) P > L and we also know lesser the Labor charges greater the profit.
Lets assume Profit is just equal to L to get break point.
500,000 = L+L/2 + L = 5/2L
L = 200,000
But P > L
So P > 200,000> 150,000