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.

It appears that you are browsing the GMAT Club forum unregistered!

Signing up is free, quick, and confidential.
Join other 500,000 members and get the full benefits of GMAT Club

Registration gives you:

Tests

Take 11 tests and quizzes from GMAT Club and leading GMAT prep companies such as Manhattan GMAT,
Knewton, and others. All are free for GMAT Club members.

Applicant Stats

View detailed applicant stats such as GPA, GMAT score, work experience, location, application
status, and more

Books/Downloads

Download thousands of study notes,
question collections, GMAT Club’s
Grammar and Math books.
All are free!

Thank you for using the timer!
We noticed you are actually not timing your practice. Click the START button first next time you use the timer.
There are many benefits to timing your practice, including:

At the beginning of the last year, a car dealership had 150 [#permalink]

Show Tags

30 Apr 2010, 10:44

00:00

A

B

C

D

E

Difficulty:

(N/A)

Question Stats:

33% (00:00) correct
67% (00:33) wrong based on 11 sessions

HideShow timer Statistics

At the beginning of the last year, a car dealership had 150 cars in stock, which the dealership had purchased for $20,000 each. During the same year, the dealership made only one purchase of the cars. What is the total amount spent by the dealership on the cars it had in stock at the end of the last year? 1) Last year the dealership purchased 50 cars for $18,000 each 2) Last year the total revenue from the sale of the cars was $180,000

Re: Answer choices are out of scope or meaning unclear [#permalink]

Show Tags

30 Apr 2010, 12:53

At the beginning of the last year, a car dealership had 150 cars in stock, which the dealership had purchased for $20,000 each. During the same year, the dealership made only one purchase of the cars. What is the total amount spent by the dealership on the cars it had in stock at the end of the last year? 1) Last year the dealership purchased 50 cars for $18,000 each 2) Last year the total revenue from the sale of the cars was $180,000

Requirement: Total Amount Spent on car which has at the end of the year. It can be deduced from: Tot Cost = No of Cars at the end of the year ( Cost of Purchase ) + Cost for Stocking the no of cars.

Opt - 1) begning of year no of cars ( Cost of purchase ) + no of times purchased during the year ( Cost ). It tells amount spend on cars. ( It holds good )

Opt -2) It tells revenue earned on cars. ( not needed ).

Re: Answer choices are out of scope or meaning unclear [#permalink]

Show Tags

30 Apr 2010, 14:11

I agree that the meaning is unclear, but this is how I see it.

We need: Cost of stock at the beginning of the year Cost of stock purchased Cost of stock sold

From the original statement, we know how many cars they had in stock at the beginning of the year, and how much they cost. We need to know what they had left at the end of the year, and the cost of those cars. Only one purchase was made, but we don’t know how much each car cost, or, how many cars were purchased. We also don’t know how many cars they sold, and which cars they sold; the ones already in stock at the beginning of the year, or the ones purchased for an unknown amount.

Statement 1: Now we know the details of the purchase, but without knowing how many cars were sold, and which cars were sold, we cannot find out the cost of the stock at the end of the year. Insufficient.

Statement 2: This gives us the revenue of what was sold during the year. But it doesn’t tell us the cost of the cars that were sold. We need the details of the cost of the specific cars sold. Insufficient.

Together, without know the details regarding the cost of the cars bought, but we are still missing the cost of cars sold. Insufficient.

Re: Answer choices are out of scope or meaning unclear [#permalink]

Show Tags

30 Apr 2010, 19:54

OA is E. The question clearly asks "What is the total amount spent by the dealership on the cars it had in stock at the end of the last year?". Hence, why do we need the cost of the cars sold?

mmphf wrote:

I agree that the meaning is unclear, but this is how I see it.

We need: Cost of stock at the beginning of the year Cost of stock purchased Cost of stock sold

From the original statement, we know how many cars they had in stock at the beginning of the year, and how much they cost. We need to know what they had left at the end of the year, and the cost of those cars. Only one purchase was made, but we don’t know how much each car cost, or, how many cars were purchased. We also don’t know how many cars they sold, and which cars they sold; the ones already in stock at the beginning of the year, or the ones purchased for an unknown amount.

Statement 1: Now we know the details of the purchase, but without knowing how many cars were sold, and which cars were sold, we cannot find out the cost of the stock at the end of the year. Insufficient.

Statement 2: This gives us the revenue of what was sold during the year. But it doesn’t tell us the cost of the cars that were sold. We need the details of the cost of the specific cars sold. Insufficient.

Together, without know the details regarding the cost of the cars bought, but we are still missing the cost of cars sold. Insufficient.

Re: Answer choices are out of scope or meaning unclear [#permalink]

Show Tags

30 Apr 2010, 22:44

achan wrote:

OA is E. The question clearly asks "What is the total amount spent by the dealership on the cars it had in stock at the end of the last year?". Hence, why do we need the cost of the cars sold?

Not the price that they were sold for, but the cost that the dealer paid to purchase those cars. Not sure if you are thinking that the question is asking how were costs for the entire year. They want to know the cost of the inventory still in stock at the end of the year.

The dealer's cost of the cars left at the end of the year is the cost in stock at the beginning of the year plus the cost of inventory purchase minus the cost of inventory sold. We don't know the cost of what was sold, only the price the dealer was able to sell it for.

Re: Answer choices are out of scope or meaning unclear [#permalink]

Show Tags

01 May 2010, 01:30

Just to rephrase you .. The question asks the NET amount the dealer has from the inventory (value at the beginning of the year -value of inventory at the end of year + purchasing cost) and not the amount he spent to buy the cars. Please confirm.

Even if above is the case, choice (1) gives purchasing cost 50*18000 and choice (2) gives Revenue(value at the beginning of the year - value of inventory at the end of year)

I still believe this question is ambiguous in nature.

mmphf wrote:

achan wrote:

OA is E. The question clearly asks "What is the total amount spent by the dealership on the cars it had in stock at the end of the last year?". Hence, why do we need the cost of the cars sold?

Not the price that they were sold for, but the cost that the dealer paid to purchase those cars. Not sure if you are thinking that the question is asking how were costs for the entire year. They want to know the cost of the inventory still in stock at the end of the year.

The dealer's cost of the cars left at the end of the year is the cost in stock at the beginning of the year plus the cost of inventory purchase minus the cost of inventory sold. We don't know the cost of what was sold, only the price the dealer was able to sell it for.

Re: Answer choices are out of scope or meaning unclear [#permalink]

Show Tags

01 May 2010, 10:37

achan wrote:

Just to rephrase you .. The question asks the NET amount the dealer has from the inventory (value at the beginning of the year -value of inventory at the end of year + purchasing cost) and not the amount he spent to buy the cars. Please confirm.

Even if above is the case, choice (1) gives purchasing cost 50*18000 and choice (2) gives Revenue(value at the beginning of the year - value of inventory at the end of year)

I still believe this question is ambiguous in nature.

mmphf wrote:

achan wrote:

OA is E. The question clearly asks "What is the total amount spent by the dealership on the cars it had in stock at the end of the last year?". Hence, why do we need the cost of the cars sold?

Not the price that they were sold for, but the cost that the dealer paid to purchase those cars. Not sure if you are thinking that the question is asking how were costs for the entire year. They want to know the cost of the inventory still in stock at the end of the year.

The dealer's cost of the cars left at the end of the year is the cost in stock at the beginning of the year plus the cost of inventory purchase minus the cost of inventory sold. We don't know the cost of what was sold, only the price the dealer was able to sell it for.

The question is not ambiguous in nature in my opinion. The questions asks "What is the total amount spent by the dealership on the cars it had in stock at the end of the last year?

So basically its asking how much money did the dealer spent on the number of cars which were left in the inventory. We know he sold some cars for some money but we don't know for much each of them was sold.

So lets take the statement one by one now.

1) Last year the dealership purchased 50 cars for $18,000 each

Okay, so now know how total amount of money did he spend in total for 200 cars, we don't know how many were left at the end of the year.

2) Last year the total revenue from the sale of the cars was $180,000

So now we know that he sold some but we don't know how many, so say he sold 10 cars each for 18000 then the total number of cars left were 190 on which he spent 20000*150 + 40*18000 each but now say he sold 10 cars for 20000 then the answer changes and hence both the statement together as well are insufficient.

Re: Answer choices are out of scope or meaning unclear [#permalink]

Show Tags

01 May 2010, 15:42

Nice question and ans should be E only.

As we do know total amount they had spend on the cars till the end of the year, but we do not have the number of cars sold to know their final stock. _________________

Excellent posts dLo saw your blog too..!! Man .. you have got some writing skills. And Just to make an argument = You had such an amazing resume ; i am glad...

So Much $$$ Business school costs a lot. This is obvious, whether you are a full-ride scholarship student or are paying fully out-of-pocket. Aside from the (constantly rising)...

I barely remember taking decent rest in the last 60 hours. It’s been relentless with submissions, birthday celebration, exams, vacating the flat, meeting people before leaving and of...

Rishabh from Gyan one services, India had a one to one interview with me where I shared my experience at IMD till now. http://www.gyanone.com/blog/life-at-imd-interview-with-imd-mba/ ...