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If a brokerage firm charged a commission of 2% of the total

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by swerve » Mon Jul 08, 2019 12:01 pm

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Answers

A

B

C

D

E

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Difficulty—

If a brokerage firm charged a commission of 2% of the total dollar amount of a certain trade, what was the total dollar amount of that trade?

1. The dollar amount of the trade minus the brokerage firm's commission was $88000
2. The brokerage firm's commission decreased the profit earned on the trade by 20%.

The OA is A

Source: Manhattan Prep
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by Jay@ManhattanReview » Thu Jul 11, 2019 10:24 pm
swerve wrote:If a brokerage firm charged a commission of 2% of the total dollar amount of a certain trade, what was the total dollar amount of that trade?

1. The dollar amount of the trade minus the brokerage firm's commission was $88000
2. The brokerage firm's commission decreased the profit earned on the trade by 20%.

The OA is A

Source: Manhattan Prep
Say the total dollar amount of the trade was $x; thus, the total amount paid = x + 2% of x = $1.02x

We have to get the value of x.

Let's take each statement one by one.

1. The dollar amount of the trade minus the brokerage firm's commission was $88000.

=> 88,000 = (100 - 2)% of the dollar amount of the trade

The dollar amount of the trade = 88,000/98%= A unique value. Sufficient.

2. The brokerage firm's commission decreased the profit earned on the trade by 20%.

Insufficient as we do not have any information about the profits.

The correct answer: A

Hope this helps!

-Jay
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