Martha bought an armchair and a coffee table at an auction and sold both items at her store. Her gross profit from the purchase and sale of the armchair was what percent greater than her gross profit from the purchase and sale of the coffee table?
1) Martha paid 10 percent more for her armchair than for the coffee table.
2) Martha sold the armchair for 20 percent more than she sold the coffee table.
Statement 1:
No information about the selling prices.
INSUFFICIENT.
Statement 2:
No information about how much was paid for the armchair and coffee table.
INSUFFICIENT.
Statements combined:
Let the amount paid for the table = 10.
Since 10% more was paid for the armchair, the amount paid for the armchair = 10 + 10% of 10 = 11.
Case 1:
Let the selling price of the table = 20.
Since the selling price of the armchair is 20% greater, the selling price of the armchair = 20 + 20% of 20 = 24.
Resulting profit ratio:
(armchair profit)/(table profit) = (24-11)/(20-10) = 13/10.
Case 2:
Let the selling price of the table = 30.
Since the selling price of the armchair is 20% greater, the selling price of the armchair = 30 + 20% of 30 = 36.
Resulting profit ratio:
(armchair profit)/(table profit) = (36-11)/(30-10) = 25/20.
Since the profit ratio can be different values, INSUFFICIENT.
The correct answer is E.
Gross profit of an armchair
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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.
I unlock the best way for YOU to solve problems.
For more information, please email me (Mitch Hunt) at [email protected].
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