Find all School-related info fast with the new School-Specific MBA Forum

It is currently 30 Jul 2016, 20:43
GMAT Club Tests

Close

GMAT Club Daily Prep

Thank you for using the timer - this advanced tool can estimate your performance and suggest more practice questions. We have subscribed you to Daily Prep Questions via email.

Customized
for You

we will pick new questions that match your level based on your Timer History

Track
Your Progress

every week, we’ll send you an estimated GMAT score based on your performance

Practice
Pays

we will pick new questions that match your level based on your Timer History

Not interested in getting valuable practice questions and articles delivered to your email? No problem, unsubscribe here.

Events & Promotions

Events & Promotions in June
Open Detailed Calendar

A pharmaceutical company received $3 million in royalties

  new topic post reply Question banks Downloads My Bookmarks Reviews Important topics  
Author Message
TAGS:

Hide Tags

Manager
Manager
avatar
Joined: 02 Dec 2012
Posts: 178
Followers: 4

Kudos [?]: 1769 [0], given: 0

A pharmaceutical company received $3 million in royalties [#permalink]

Show Tags

New post 12 Dec 2012, 05:29
18
This post was
BOOKMARKED
00:00
A
B
C
D
E

Difficulty:

  55% (hard)

Question Stats:

64% (02:59) correct 36% (02:04) wrong based on 976 sessions

HideShow timer Statistics

A pharmaceutical company received $3 million in royalties on the first $20 million in sales of the generic equivalent of one of its products and then $9 million in royalties on the next $108 million in sales. By approximately what percent did the ratio of royalties to sales decrease from the first $20 million in sales to the next $108 million in sales?

(A) 8%
(B) 15%
(C) 45%
(D) 52%
(E) 56%
[Reveal] Spoiler: OA
Expert Post
3 KUDOS received
Math Expert
User avatar
Joined: 02 Sep 2009
Posts: 34121
Followers: 6110

Kudos [?]: 76990 [3] , given: 9994

Re: A pharmaceutical company received $3 million in royalties [#permalink]

Show Tags

New post 12 Dec 2012, 05:32
3
This post received
KUDOS
Expert's post
6
This post was
BOOKMARKED
Walkabout wrote:
A pharmaceutical company received $3 million in royalties on the first $20 million in sales of the generic equivalent of one of its products and then $9 million in royalties on the next $108 million in sales. By approximately what percent did the ratio of royalties to sales decrease from the first $20 million in sales to the next $108 million in sales?

(A) 8%
(B) 15%
(C) 45%
(D) 52%
(E) 56%


General formula for percent increase or decrease, (percent change) is \(Percent=\frac{Change}{Original}*100\).

Thus, the royalties decreased by approximately \(=\frac{\frac{3}{20}-\frac{9}{108}}{\frac{3}{20}}*100\approx{44%}\).

Answer: C.
_________________

New to the Math Forum?
Please read this: All You Need for Quant | PLEASE READ AND FOLLOW: 12 Rules for Posting!!!

Resources:
GMAT Math Book | Triangles | Polygons | Coordinate Geometry | Factorials | Circles | Number Theory | Remainders; 8. Overlapping Sets | PDF of Math Book; 10. Remainders | GMAT Prep Software Analysis | SEVEN SAMURAI OF 2012 (BEST DISCUSSIONS) | Tricky questions from previous years.

Collection of Questions:
PS: 1. Tough and Tricky questions; 2. Hard questions; 3. Hard questions part 2; 4. Standard deviation; 5. Tough Problem Solving Questions With Solutions; 6. Probability and Combinations Questions With Solutions; 7 Tough and tricky exponents and roots questions; 8 12 Easy Pieces (or not?); 9 Bakers' Dozen; 10 Algebra set. ,11 Mixed Questions, 12 Fresh Meat

DS: 1. DS tough questions; 2. DS tough questions part 2; 3. DS tough questions part 3; 4. DS Standard deviation; 5. Inequalities; 6. 700+ GMAT Data Sufficiency Questions With Explanations; 7 Tough and tricky exponents and roots questions; 8 The Discreet Charm of the DS; 9 Devil's Dozen!!!; 10 Number Properties set., 11 New DS set.


What are GMAT Club Tests?
Extra-hard Quant Tests with Brilliant Analytics

3 KUDOS received
Intern
Intern
User avatar
Joined: 24 Apr 2012
Posts: 48
Followers: 0

Kudos [?]: 21 [3] , given: 1

Re: A pharmaceutical company received $3 million in royalties [#permalink]

Show Tags

New post 14 Dec 2012, 03:18
3
This post received
KUDOS
Ans:

for this kind of percentage change questions we apply the formula (change/original)x100, so here we have initial ratio=3/20 final ratio=1/12 . now change = 3/20-1/12=1/15 , putting these values in the formula we get the answer as (C).
_________________

www.mnemoniceducation.com

TURN ON YOUR MINDS!!!

Intern
Intern
avatar
Joined: 04 Dec 2012
Posts: 2
Followers: 0

Kudos [?]: 0 [0], given: 1

Re: A pharmaceutical company received $3 million in royalties [#permalink]

Show Tags

New post 15 Dec 2012, 09:17
To Brunuel:

Thanks for the sharing, I'm wondering whether your formula shouldn't be (9/108-3/20) / (3/20) ? This doesn't change the final answer anyway.

BTW thanks for all the great job you have been doing so far! I'm new to the forum and I'm just speechless.

cheer Mate
1 KUDOS received
Manager
Manager
avatar
Joined: 25 Jul 2012
Posts: 78
Location: United States
Followers: 0

Kudos [?]: 69 [1] , given: 137

Re: A pharmaceutical company received $3 million in royalties [#permalink]

Show Tags

New post 26 Feb 2013, 11:34
1
This post received
KUDOS
carloswn wrote:
To Brunuel:

Thanks for the sharing, I'm wondering whether your formula shouldn't be (9/108-3/20) / (3/20) ? This doesn't change the final answer anyway.



I don't think it'll make a difference because in the numerator we are just looking for the difference between the two amounts. Just make sure that in the denominator you have the original value.

For better understanding:

\(Percent Change = \frac{Change in Value}{Original Value}\)

Hence, the "change in value" is just the difference. I wouldn't worry about a negative here.
_________________

If my post has contributed to your learning or teaching in any way, feel free to hit the kudos button ^_^

1 KUDOS received
GMAT Club Legend
GMAT Club Legend
User avatar
Joined: 09 Sep 2013
Posts: 10680
Followers: 496

Kudos [?]: 131 [1] , given: 0

Premium Member
Re: A pharmaceutical company received $3 million in royalties [#permalink]

Show Tags

New post 26 Jun 2014, 22:19
1
This post received
KUDOS
Hello from the GMAT Club BumpBot!

Thanks to another GMAT Club member, I have just discovered this valuable topic, yet it had no discussion for over a year. I am now bumping it up - doing my job. I think you may find it valuable (esp those replies with Kudos).

Want to see all other topics I dig out? Follow me (click follow button on profile). You will receive a summary of all topics I bump in your profile area as well as via email.
_________________

GMAT Books | GMAT Club Tests | Best Prices on GMAT Courses | GMAT Mobile App | Math Resources | Verbal Resources

Manager
Manager
avatar
Joined: 07 Apr 2014
Posts: 147
Followers: 1

Kudos [?]: 19 [0], given: 81

Re: A pharmaceutical company received $3 million in royalties [#permalink]

Show Tags

New post 11 Sep 2014, 12:15
Bunuel wrote:
Walkabout wrote:
A pharmaceutical company received $3 million in royalties on the first $20 million in sales of the generic equivalent of one of its products and then $9 million in royalties on the next $108 million in sales. By approximately what percent did the ratio of royalties to sales decrease from the first $20 million in sales to the next $108 million in sales?

(A) 8%
(B) 15%
(C) 45%
(D) 52%
(E) 56%


General formula for percent increase or decrease, (percent change) is \(Percent=\frac{Change}{Original}*100\).

Thus, the royalties decreased by approximately \(=\frac{\frac{3}{20}-\frac{9}{108}}{\frac{3}{20}}*100\approx{44%}\).

Answer: C.




Hi Bunuel,

please confirm on this..

for first one --15%

for the second one approx. 8 %

so (15-8)/15 = 7/15 approx = 45
Intern
Intern
avatar
Joined: 16 May 2015
Posts: 46
Followers: 0

Kudos [?]: 7 [0], given: 11

Re: A pharmaceutical company received $3 million in royalties [#permalink]

Show Tags

New post 29 May 2015, 02:57
For me, percentage questions seem time consuming ..not sure if I am the only one feel this way..
Expert Post
1 KUDOS received
EMPOWERgmat Instructor
User avatar
Status: GMAT Assassin/Co-Founder
Affiliations: EMPOWERgmat
Joined: 19 Dec 2014
Posts: 6944
Location: United States (CA)
GMAT 1: 800 Q51 V49
GRE 1: 340 Q170 V170
Followers: 300

Kudos [?]: 2055 [1] , given: 161

Re: A pharmaceutical company received $3 million in royalties [#permalink]

Show Tags

New post 29 May 2015, 15:53
1
This post received
KUDOS
Expert's post
Hi katzzzz,

Percent questions come from the broader family of 'ratio-based' questions and you're going to see a bunch of those on Test Day, so you have to make sure that you're ready for them. While some of these questions can be wordier/longer than average, the 'key' to answering these types of questions quicker is to organize information in the most effective way possible (for the question that is asked and for the answer choices that are given).

For example, ALL of the following examples mean the same thing, so you have to decide which would be easiest to work with...

Men/Women = 1 to 10 = 1:10 = 1/10 = 0.1 = 10%
10M = 1W

GMAT assassins aren't born, they're made,
Rich
_________________

Rich Cohen

Co-Founder & GMAT Assassin

Special Offer: Save $75 + GMAT Club Tests

60-point improvement guarantee
www.empowergmat.com/

***********************Select EMPOWERgmat Courses now include ALL 6 Official GMAC CATs!***********************

Expert Post
e-GMAT Representative
User avatar
Joined: 04 Jan 2015
Posts: 338
Followers: 96

Kudos [?]: 772 [0], given: 84

A pharmaceutical company received $3 million in royalties [#permalink]

Show Tags

New post 02 Jun 2015, 05:48
Expert's post
katzzzz wrote:
For me, percentage questions seem time consuming ..not sure if I am the only one feel this way..


Dear katzzzz

One reason why percentage questions may seem time consuming to you is that they usually have multiple data points (for example, the current question has earlier royalty, earlier sales, new royalty, new sales, the percentage change between earlier ratio of royalty:sales to new royalty:sales. That may seem quite a handful of quantities to track and tackle! :) )

Here's an approach that I suggest to you for questions that seem to have lots of information: Always go from the unknown to the known.

By Unknown, I mean what the question is asking.
By known, I mean the given information.

Let me illustrate this approach here.

The question is asking about the % decrease in some ratio.

So, my first step is to let this % decrease be P.

So, I can write:

\(Later Ratio = (1 - \frac{P}{100})(Earlier Ratio)\)

Now, what is the Ratio being considered here? It is the ratio of 'Royalty to Sales'

So, the above equation becomes:

\(\frac{(Later Royalty)}{(Later Sales)} = (1 - \frac{P}{100})\frac{(Earlier Royalty)}{(Earlier Sales)}\)

Now the question is easy to solve. You simply substitute the values of earlier and later royalty, and earlier and later sales, and you get the value of P.

As you can see, this approach of going 'From Unknown to Known' gave us a sense of direction to wade through the given information.

I hope this helped. :)

Best Regards

Japinder
_________________












1158 reviews | '4 out of Top 5' Instructors on gmatclub | 70 point improvement guarantee | www.e-gmat.com

Manager
Manager
avatar
Joined: 23 Sep 2015
Posts: 170
Schools: Insead Sept '17
GMAT 1: 690 Q47 V38
GMAT 2: 700 Q48 V38
Followers: 0

Kudos [?]: 27 [0], given: 46

Premium Member
Re: A pharmaceutical company received $3 million in royalties [#permalink]

Show Tags

New post 23 Nov 2015, 15:55
% change also equals :
\(\frac{new}{old}\)\(- 1\)

\(\frac{9}{108}\)*\(\frac{20}{3}\)\(- 1\)

= \(\frac{-4}{9}\) ==> since 1/9 = 0,11 ==> -44%
Intern
Intern
User avatar
Joined: 30 Dec 2015
Posts: 13
GPA: 3.92
WE: Engineering (Aerospace and Defense)
Followers: 0

Kudos [?]: 1 [0], given: 26

A pharmaceutical company received $3 million in royalties [#permalink]

Show Tags

New post 17 Jan 2016, 20:55
Used normal percentage method but approximated cause I was trying to complete this in 1 min
[3/20 - 9/100]*(20/3)*100
(15-9)/100 *(20/3)*100
(6/100)*(20/3)*100
=40% = ~44% (again, I approximated 108 to 100, I was lucky, if the answer choice was either 52% & 56%, I would be pulling my hair :x . Lesson learnt.)
_________________

Always Late!

Intern
Intern
avatar
Joined: 02 Feb 2016
Posts: 41
Location: United States
Concentration: Finance, Technology
Schools: LBS '18, IE April '17
Followers: 0

Kudos [?]: 11 [0], given: 29

A pharmaceutical company received $3 million in royalties [#permalink]

Show Tags

New post 08 Mar 2016, 00:30
To Bunuel:

I tend to get confused when estimating in certain scenarios and select the wrong answer. In this case I took denominator 20 as 18 so that 3/20 becomes 3/18 = 1/6 and 9/108 = 1/12 so 1/6-1/12 =1/12 and now (1/12)/(1/6)*100 = 50% so I would have selected (D) - 52% which is the closest. In another case had I taken 20 as 21(more convenient) the fraction would have been 3/21 = 1/7 and to balance the round off I would have taken 12 as 10 (one increase other decrease) so (1/7-1/10)/(1/7) = (3/70)*7 = 30% its quite far apart from the options so either 15 or 45 although we are actually reducing the 108 mn to 90 mn which is a huge difference so the overall result should be higher so 45 should be the case. In the next scenario I took 20 mn as 21 mn and then ratio became (1/7) so ({1/7-1/12}/(1/7))*100 = 5/12*100 = 42% approx so again option C (45%). So in these cases the answers are different so then how to reach the correct answer in quick time if choices are quite close, there is a high chance of error. Kindly advise the extent to which we can approximate values of fractions as answers can be a huge difference in the answers arrived by taking multiple scenarios as if one scenario leads us to one choice we will quickly select it and move on as there is the time factor.
_________________

Give kudos and appreciate if you think its worthwhile

Senior Manager
Senior Manager
User avatar
Joined: 12 Sep 2015
Posts: 461
Location: Canada
Followers: 36

Kudos [?]: 334 [0], given: 12

Re: A pharmaceutical company received $3 million in royalties [#permalink]

Show Tags

New post 10 Apr 2016, 10:43
Walkabout wrote:
A pharmaceutical company received $3 million in royalties on the first $20 million in sales of the generic equivalent of one of its products and then $9 million in royalties on the next $108 million in sales. By approximately what percent did the ratio of royalties to sales decrease from the first $20 million in sales to the next $108 million in sales?

(A) 8%
(B) 15%
(C) 45%
(D) 52%
(E) 56%


First $20 million: royalties/sales ratio = 3/20 = 36/240
Next $108 million: royalties/sales ratio = 9/108 = 1/12 = 20/240

Noticed that I rewrote both with the SAME DENOMINATOR.
So, now all we need to is determine the percent change from 36 to 20.
To do so, we could use some more lengthy calculations [e.g., 100(36-20)/36]
HOWEVER, notice that, if we start at 36, a 50% decrease would give us 18.
So going from 36 to 20, must be a decrease that's LESS THAN 50% (but also pretty close to 50%)
Only one answer choice works.

Answer: C

Related Resource
The following free video covers the concepts/strategies that are useful for answering this question:

Cheers,
Brent
_________________

Brent Hanneson - Founder of GMAT Prep Now, a free & comprehensive GMAT course with:
- over 500 videos (35 hours of instruction)
- over 1800 practice questions
- 2 full-length practice tests and other bonus offers
- http://www.gmatprepnow.com/
Brent also tutors students for the GMAT

Manager
Manager
User avatar
Status: Head GMAT Instructor
Affiliations: Target Test Prep
Joined: 04 Mar 2011
Posts: 159
Followers: 7

Kudos [?]: 29 [0], given: 2

Re: A pharmaceutical company received $3 million in royalties [#permalink]

Show Tags

New post 03 May 2016, 09:27
Walkabout wrote:
A pharmaceutical company received $3 million in royalties on the first $20 million in sales of the generic equivalent of one of its products and then $9 million in royalties on the next $108 million in sales. By approximately what percent did the ratio of royalties to sales decrease from the first $20 million in sales to the next $108 million in sales?

(A) 8%
(B) 15%
(C) 45%
(D) 52%
(E) 56%


Solution:

This is a percent decrease problem. We will use the formula: percent change = (new – old)/old x 100 to calculate the final answer.

We first set up the ratios of royalties to sales. The first ratio will be for the first 20 million in sales, and the second ratio will be for the next 108 million in sales. Because all of the sales are in millions, we do not have to express all the trailing zeros in our ratios.

First 20 Million

royalties/sales = 3/20

Next 108 Million

royalties/sales = 9/108 = 1/12

Because each ratio is not an easy number to use, we can simplify each one by multiplying each by the LCM of the two denominators, which is 60. Keep in mind that we are able to do this only because our answer choices are expressed in percents.

First 20 Million

royalties/sales = (3/20) x 60 = 9

Next 108 Million

royalties/sales = 9/108 = (1/12) x 60 = 5

We can plug 9 and 5 into our percent change formula:

(new – old)/old x 100

[(5 – 9)/9] x 100

-4/9 x 100

At this point we can stop and consider the answer choices. Since we know that 4/9 is just a bit less than ½, we know that -4/9 x 100 is about a 45% decrease.

Answer C.
_________________

Image
Jeffrey Miller
Jeffrey Miller
Head of GMAT Instruction

Re: A pharmaceutical company received $3 million in royalties   [#permalink] 03 May 2016, 09:27
    Similar topics Author Replies Last post
Similar
Topics:
4 An author received $0.80 in royalties for each of the first 100,000 co RSOHAL 2 20 Dec 2015, 03:13
25 Experts publish their posts in the topic In the "Mashburn" pharmaceutical company there are two machi superpus07 14 02 Oct 2012, 17:25
2 Experts publish their posts in the topic A company received $2 million in royalties on the first $10 million Jinglander 7 25 May 2010, 10:19
19 Experts publish their posts in the topic A pharmaceutical company received $3 million in royalties on umaa 14 17 Dec 2009, 09:17
7 Experts publish their posts in the topic A pharmaceutical company received $3 million in royalties on slingfox 15 19 Oct 2009, 00:34
Display posts from previous: Sort by

A pharmaceutical company received $3 million in royalties

  new topic post reply Question banks Downloads My Bookmarks Reviews Important topics  


GMAT Club MBA Forum Home| About| Terms and Conditions| GMAT Club Rules| Contact| Sitemap

Powered by phpBB © phpBB Group and phpBB SEO

Kindly note that the GMAT® test is a registered trademark of the Graduate Management Admission Council®, and this site has neither been reviewed nor endorsed by GMAC®.