## ieGAT question

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### ieGAT question

by uniyal01 » Wed Jan 20, 2016 12:21 pm

Thanks!
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2nd q

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by ceilidh.erickson » Thu Jan 21, 2016 7:55 am
This is not a GMAT-style question. Please only post questions from official GMAC sources or reputable GMAT prep companies in this forum.
Ceilidh Erickson
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by Matt@VeritasPrep » Fri Jan 22, 2016 4:47 pm
It's pretty easy, though.

For the first question,

Profit = Revenue - Expenses
= Revenue * 1,000â‚¬ - (# of professionals) * 3,500â‚¬
= 3,728*1,000â‚¬ - 110*3,500â‚¬
= 3,343 * 1,000â‚¬
= A

For the second question, I'd need to know whether the business is Type I or Type II (or both).

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by mserje » Tue May 17, 2016 10:56 am
Matt -

I understand how the answer is A for question 1, but I have not been able to figure out how the answer is D for question 2. I keep getting C instead.

Could you help?

Thanks!

Matt@VeritasPrep wrote:It's pretty easy, though.

For the first question,

Profit = Revenue - Expenses
= Revenue * 1,000â‚¬ - (# of professionals) * 3,500â‚¬
= 3,728*1,000â‚¬ - 110*3,500â‚¬
= 3,343 * 1,000â‚¬
= A

For the second question, I'd need to know whether the business is Type I or Type II (or both).

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by Mhafez » Mon Jul 18, 2016 2:25 am
For company A:

Profit = 6,108,000-(281*3500) = 5,124,500

Type I investment is 50,000 since the growth between year X and year X-1 is 18%
Type II investment is 500 euro for professionals from 100 to 150 and 1,000 euro for professionals above 150.
so Investment type II is (50*500)+(131*1000) = 156,000

Money to be split = 5,124,500 - 50,000 - 156,000 = 4,918,500
For each partner = 4,918,500/34 = 144,661 = 144.66

Personally I think Type II is poorly written. The first sentence reads "no investment will be made if the number of professionals in the company is less than 100" which makes you think each condition is separate depending on the number of professionals in the company

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by Matt@VeritasPrep » Wed Jul 20, 2016 10:18 pm
mserje wrote:Matt -

I understand how the answer is A for question 1, but I have not been able to figure out how the answer is D for question 2. I keep getting C instead.

Could you help?

Thanks!
Eek, somehow I never saw this message! Profuse apologies!

The only way I can get to D is by assuming:

i) The company makes both Type I and Type II investments
ii) Expenses per person only are paid per professional, not also per partner
iii) "between 100 and 150" means 100 â‰¤ x â‰¤Â 150 (which is terrible)

Assuming all that, we have

A's growth = 6.108 / 5.172 â‰ˆ 1.18%, so that merits a 50,000â‚¬ investment.

A has 281 professionals, so we invest another 51*500â‚¬ + 131*1000â‚¬ => 156,500â‚¬.

We know Profits = Revenue - Expenses = 6,108,000â‚¬ - 3,500*281â‚¬ = 5,124,500â‚¬

We know the money to be split = Profits - Investment = 5,124,500â‚¬ - (50,000 + 156,000)â‚¬ = 4,918,500

We're splitting that among 34 partners, so 4,918,500â‚¬/34 â‰ˆ 144,661â‚¬

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