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How much did credit-card fraud cost United States banks in year X to the nearest $ 10 million?

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How much did credit-card fraud cost United States banks in year X to the nearest $ 10 million?

by BTGmoderatorLU » Thu May 28, 2020 10:41 am
Source: Official Guide

How much did credit-card fraud cost United States banks in year X to the nearest $ 10 million?

1) In year X, counterfeit cards and telephone and mail-order fraud accounted for 39 percent of the total amount that card fraud cost the banks.

2) In year X, stolen cards accounted for $158.4 million, or 16 percent, of the total amount that credit-card fraud cost the banks.

The OA is B
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Re: How much did credit-card fraud cost United States banks in year X to the nearest $ 10 million?

by deloitte247 » Fri May 29, 2020 10:36 am
Statement 1 => In year x counterfeit cards, telephone and mail-order fraud accounted for 39% of the total amount that card fraud cost the banks

Let the total amount of credit-card frauds cost = x
Counterfeit cards + telephone + mail order fraud = 39% of x
This cannot give us the exact value of x hence credit-card frauds cannot be estimated to the nearest 10 million. Statement 1 is NOT SUFFICIENT

Statement 2 => In year x, stolen cards accounted for $158.4 million or 16% of the total amount that credit card fraud cost the banks
Let the total amount of credit card frauds cost = x
Stolen cards = $158.4 million
$158.4 million = 16% of x
$$$158.4\ million\ =\ \frac{16}{100}\cdot x$$
$$x=$158.4\ million\ \cdot\ \frac{100}{16}$$
$$x=9.9\ million\ \cdot\ 100$$
$$x=9,900,000\cdot100$$
$$x=990,000,000$$
$$x\approx990.0\ million$$

Statement 2 alone is SUFFICIENT
Answer = B
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Re: How much did credit-card fraud cost United States banks in year X to the nearest $ 10 million?

by Scott@TargetTestPrep » Mon May 31, 2021 2:06 pm
BTGmoderatorLU wrote: ↑
Thu May 28, 2020 10:41 am
 Source: Official Guide

How much did credit-card fraud cost United States banks in year X to the nearest $ 10 million?

1) In year X, counterfeit cards and telephone and mail-order fraud accounted for 39 percent of the total amount that card fraud cost the banks.

2) In year X, stolen cards accounted for $158.4 million, or 16 percent, of the total amount that credit-card fraud cost the banks.

The OA is B
Solution:

Statement One Alone:

We know the combined percent of counterfeit cards, and telephone and mail-order frauds; however, we don’t know the combined dollar amount of these two types of frauds. For instance, if the combined dollar amount of counterfeit cards and telephone and mail-order fraud was $3.9 million, then the credit card fraud cost US banks $10 million in year X. However, if the combined dollar amount of counterfeit cards and telephone and mail-order fraud was $39 million, then the credit card fraud cost US banks $100 million in year X. Statement one alone is not sufficient.

Statement Two Alone:

We know both the dollar amount and percent of stolen cards in year X. To determine how much credit card fraud cost US banks in year X, we can simply divide $158.4 million by 0.16. Statement two alone is sufficient.

Answer: B

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