To get 3 of same color, you need at least 21 gumballs. 3 for a quarter. 21 for $1.75.

Here is my reasoning and perhaps someone can kindly let me know what I am doing wrong.

Let each colour be represented by the first 10 letters of the alphabet:
A B C D E F G H I J

Suppose your first quarter will give you the following colours: ABC

Your next quarter will give you DEF
And so on and so on...

To obtain the same colours again, you will spend money on the following sets of gumballs:

DEF GHI JAB CDE FGH IJA BCD EFG HIJ ABC (10 sets)

10 sets of three X $0.25 per set = $2.25

Therefore, how does one get to 21-gumballs dispensed??

Am I interpreting the question incorrectly?

You are looking for 3 colors of every gumball being dispensed, but the question asks for at least 1 color being dispensed.

According to your sequence:

DEF GHI JAB CDE FGH IJA BCD EFG HIJ ABC

Those 7 terms alread.y have 3 Ds, therefore, you know you have 3 of the same color. A quarter per trio equals $1.75.

OooOooh. OK. Thanks Beny, your explanation really turned on the light.

When I read the question, I interpreted it differently which led me to pick another answer -- also a choice in the given answers. Yikes.

I think the question was ambiguous and I feel confidant that GMAT writers would ensure more explicit writings on the actual test.

Thanks again!