OG 12 DS question

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OG 12 DS question

by gdk800 » Thu Nov 25, 2010 10:03 am
Jerry bought 7 clothing items, including a coat, and the sum of the prices of these items was $365. If there was no sales tax on any clothing item with a price of less than $100 and a 7 percent sales tax on all other clothing items, what was the total sales tax on the 7 items that Jerry bought?
(1) The price of the coat was $125.
(2) The average (arithmetic mean) price for the 6 items other than the coat was $40.

If we consider the two statements together. Considering price of coat = $125. The price of other 6 items would be 365 - 125 = $240, which is in accordance with what statement (2) says about the average price of 6 other items tob be $40 each. Thus the total tax would be on only the coat costing greater than 100. Thus sales tax would be 7% of 125 = $8.75.

But the OA is E

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by Rahul@gurome » Thu Nov 25, 2010 11:05 am
Statement 1: Price of coat $125.
Therefore for the coat definitely there is 7% sales tax.
Price of other 6 clothing items = $ (365 - 125) = $240.
It is possible that any one or two of the clothing item of these 6 has price greater than $100. Thus there may be 7% sales tax on them.

Not sufficient.


Statement 2: The average (arithmetic mean) price for the 6 items other than the coat was $40. This is same as above!

Not sufficient.

1 & 2 Together: No new information.

Not sufficient.

The correct answer is E.
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by gdk800 » Thu Nov 25, 2010 12:03 pm
Rahul,

Kindly explain the following.


If we consider the two statements together. Considering price of coat = $125. The price of other 6 items would be 365 - 125 = $240, which is in accordance with what statement (2) says about the average price of 6 other items to be $40 each. Thus the total tax would be on only the coat costing greater than 100.

Therefore sales tax would be 7% of 125 = $8.75. We get what the question asks.

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by rros0770 » Fri Nov 26, 2010 12:20 pm
Hey GDK-

It's providing us the average cost of the 6 items, not the actual cost of the 6 items.

5 items could cost $1 each and the 6th item could cost $235, and that will average out to $40.

In the above scenario, there would be tax on the $125 coat and tax on that $235 item which would total $25.20 in taxes.

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by gdk800 » Tue Nov 30, 2010 6:55 am
Thank you everyone. I really needed to clarify this one. :D