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A certain bank has ten branches. What is the total amount of

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A certain bank has ten branches. What is the total amount of [#permalink] New post 18 Nov 2011, 13:00
00:00
A
B
C
D
E

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  45% (medium)

Question Stats:

39% (01:36) correct 61% (00:33) wrong based on 13 sessions
A certain bank has ten branches. What is the total amount of assets under management at the bank?

(1) There is an average of 400 customers per branch. When each branch’s average assets under management per customer is computed, these values are added together and this sum is divided by 10. The result is $400,000 per customer.

(2) The bank has a total of 4,000 customers. When the total assets per branch are added up, each branch is found to manage, on average, 160 million dollars in assets.
[Reveal] Spoiler: OA

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Re: A certain bank has ten branches. What is the total amount of [#permalink] New post 19 Nov 2011, 11:11
I believe D is correct.

Total of 10 branches.

(1) 400 customers per branch times $400k per customer times 10 branches gives you total assets. SUFFICIENT.

(2). $160mil per branch times 10 branches gives total assets. SUFFICIENT.
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Re: A certain bank has ten branches. What is the total amount of [#permalink] New post 06 Aug 2014, 19:15
The OA is B. Following is the explanation from MGMAT:

(1) INSUFFICIENT: When the average assets under management (AUM) per customer of each of the 10 branches are added up and the result is divided by 10, the value that is obtained is the simple average of the 10 branches’ average AUM per customer. Multiplying this number by the total number of customers will not give us the total amount of assets under management. The reason is that what is needed here is a weighted average of the average AUM per customer for the 10 branches. Each branch’s average AUM per customer needs to be weighted according to the number of customers at that branch when computing the overall average AUM per customer for the whole bank.

(2) SUFFICIENT: The average of $160 million in assets under management per branch spoken about here was NOT calculated as a simple average of the 10 branches’ average AUM per customer as in statement 1. This average was found by adding up the assets in each bank and dividing by 10, the number of branches (“the total assets per branch were added up…”). To regenerate that original total, we simply need to multiply the $160 million by the number of branches, 10. (This is according to the simple average formula: average = sum / number of terms)
The correct answer is B.
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Re: A certain bank has ten branches. What is the total amount of [#permalink] New post 08 Aug 2014, 22:01
enigma123 wrote:
A certain bank has ten branches. What is the total amount of assets under management at the bank?
(1) There is an average of 400 customers per branch. When each branch’s average assets under management per customer is computed, these values are added together and this sum is divided by 10. The result is $400,000 per customer.
(2) The bank has a total of 4,000 customers. When the total assets per branch are added up, each branch is found to manage, on average, 160 million dollars in assets.

As the OA is not provided, for me its D. Can someone please have a look and let me know if you think otherwise?

(1) we have assets for each branch = a1, a2,...a10; customers for each brand = c1,c2,...c10
(a1/c1 + a2/c2+ ....+a10/c10)/10= 400,000
On the other hand, total amount of assets under management for each brand= C = c1+ c2+....+c10, Total customer =C = c1+ c2+...+c10
Total assets/Total customer = A/C = Average assets per customer for all brand.
A/C = (a1+...+a10)/(c1+...+c10) is different from (a1/c1 + a2/c2+ ....+a10/c10).
INSUFFICIENT

(2) We can calculate total assets per branch * 10 branches = total amount of assets = 160million*10
SUFFICIENT

B is the answer
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Re: A certain bank has ten branches. What is the total amount of   [#permalink] 08 Aug 2014, 22:01
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