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A large research project was scheduled over the course...

by BTGmoderatorLU » Thu Jan 11, 2018 7:19 am
A large reaserch project was scheduled over the course of 28-month period, and a budget of $84,000 was alloted for the course of the entire project. After seven months, the project had spent $19,800. Was the project at this point over budget or under budget, and by how many?

A. under, $4200
B. under, $1200
C. under, $700
D. over, $1800
E. over, $5800

The OA is B.

I'm really confused with this PS question. Experts, any suggestion how can I solve it? Thanks in advance.
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answer

by EconomistGMATTutor » Thu Jan 11, 2018 9:04 am
Hello LUANDATO.

Let's take a look at your question.

A large reaserch project was scheduled over the course of 28-month period, and a budget of $84,000 was alloted for the course of the entire project , it implies that $$\frac{84000}{28}=3000\ \ \text{dollars}\ \text{per}\ \text{month}.$$ Now after seven months, the project had spent $19,800, so they have spent less than 3000 per month. It implies that they are under budget by 21000-19800=1200$.

So, the correct answer is the option B.

I hope this answer an help you.

Feel free to ask me again if you have a doubt.

Regards.
GMAT Prep From The Economist
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by [email protected] » Thu Jan 11, 2018 10:59 am
Hi LUANDATO,

We're told that a reaserch project was scheduled over the course of a 28-month period and a budget of $84,000 was alloted for the course of the entire project. After SEVEN months, the project had spent $19,800. We're asked if the project at this point was over budget or under budget and by how much money.

While you can certainly calculate the 'per month' budget of this project, the prompt gives you a 'shortcut' to help you avoid having to do that math. Notice that the overall time period is 28 months and 7 months have gone by.... that is 1/4 of the time period... which means that 1/4 of the budget should have been spent.

(1/4)($84,000) = $21,000

We're told that only $19,800 was spent (of the $21,000) that was budgeted), so the project was UNDER budget by $1,200 at that point.

Final Answer: B

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Rich
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