Last year, the average price of eight different products sold by Company X was $245. What is the average price of those same eight products this year?
(1) For 5 of the 8 products, the price is 10% higher this year than last.
(2) For 3 of the products, the price remained unchanged.
[spoiler]OA=E[/spoiler]
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Last year, the average price of eight different products
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Ian Stewart
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The answer is instantly C or E, because using either statement alone, we don't know anything about some of the products.
Using both Statements, it's possible, say, that five of the products cost $0.10 each, and the other three cost more than $600 each. If the five cheap products increased in price by 10%, so by $0.01, that would have almost no effect on the average price of all of the products. But it's possible that five of the products cost nearly $400 each, and three of them cost $0.01 each, and then if the five products increased by 10%, so by nearly $40 each, the average price of all of the products could have increased by nearly $40. That is, with no information about how expensive the two groups of products are, there's no way to work out precisely how the overall average changed, and the answer is E.
Using both Statements, it's possible, say, that five of the products cost $0.10 each, and the other three cost more than $600 each. If the five cheap products increased in price by 10%, so by $0.01, that would have almost no effect on the average price of all of the products. But it's possible that five of the products cost nearly $400 each, and three of them cost $0.01 each, and then if the five products increased by 10%, so by nearly $40 each, the average price of all of the products could have increased by nearly $40. That is, with no information about how expensive the two groups of products are, there's no way to work out precisely how the overall average changed, and the answer is E.
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We can determine this year's average price if we know the difference between this year's revenue and last year's.M7MBA wrote:Last year, the average price of eight different products sold by Company X was $245. What is the average price of those same eight products this year?
(1) For 5 of the 8 products, the price is 10% higher this year than last.
(2) For 3 of the products, the price remained unchanged
Statements combined:
Case 1: Last year the 5 products in Statement 1 had an average price of $10, for a total of $50 in revenue
In this case, the increase in revenue yielded by this year's 10% price increase = 10% of 50 = 5.
Case 2; Last year the 5 products in Statement 1 had an average price of $20, for a total of $100 in revenue
In this case, the increase in revenue yielded by this year's 10% price increase = 10% of 100 = 10.
Since the increase in revenue can be different values, the two statements combined are INSUFFICIENT.
The correct answer is E.
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I have worked with students based in the US, Australia, Taiwan, China, Tajikistan, Kuwait, Saudi Arabia -- a long list of countries.
My students have been admitted to HBS, CBS, Tuck, Yale, Stern, Fuqua -- a long list of top programs.
As a tutor, I don't simply teach you how I would approach problems.
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