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Jim is able to sell a hand-carved statue for $670 which was

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Jim is able to sell a hand-carved statue for $670 which was [#permalink] New post 02 Nov 2012, 10:54
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Question Stats:

84% (01:55) correct 16% (01:35) wrong based on 45 sessions
Jim is able to sell a hand-carved statue for $670 which was a 35% profit over his cost. How much did the statue originally cost him?

A. $496.30
B. $512.40
C. $555.40
D. $574.90
E. $588.20
[Reveal] Spoiler: OA

Last edited by Bunuel on 02 Nov 2012, 13:07, edited 1 time in total.
Renamed the topic and edited the question.
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Magoosh GMAT Instructor
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Re: Easy question [#permalink] New post 02 Nov 2012, 11:06
Expert's post
MariaF wrote:
I don't know what's wrong with me, but I think I misunderstood the question and now I need some help...
Jim is able to sell a hand-carved statue for $670 which was a 35% profit over his cost. How much did the statue originally cost him?

A. $496.30
B. $512.40
C. $555.40
D. $574.90
E. $588.20

I'm happy to help with this. :-)

First, I'll point out, we really need a calculator for this question, so in that sense, it's not realistic as a GMAT PS problem. The GMAT is always good about giving PS problems in which there is some elegant non-calculator approach.

A tricky thing about this problem is ---- we can't simply figure out 35% of this final amount $670. In other words, going down 35% from $670 will not bring us back to the same starting point X, even though increasing 35% from X brings us to $670.

This is, in many ways, one of the most fundamental math misconceptions, and the GMAT absolutely loves to exploit it. Increasing by any percent P, and decreasing by the same percent, NEVER bring you back to the same place. For more on this, see this blog:
http://magoosh.com/gmat/2012/understand ... -the-gmat/

That blog also discusses using multipliers for percent increases & decreases, which is by far the most elegant way to handle them. Here, we start with some X that we would like to find. We increase this X by 35%. As a decimal, that's 0.35, and we add 1 to this decimal to create the multiplier for a 35% increase. This multiplier is 1.35. We know 35% more than X is $670. In other words:

670 = 1.35*X

X = 670/1.35 = 496.2962962963...

which rounds to $496.30, which is (A).

Does all this make sense?

Mike :-)
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Mike McGarry
Magoosh Test Prep

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Re: Easy question [#permalink] New post 02 Nov 2012, 12:08
MariaF wrote:
I don't know what's wrong with me, but I think I misunderstood the question and now I need some help...
Jim is able to sell a hand-carved statue for $670 which was a 35% profit over his cost. How much did the statue originally cost him?

A. $496.30
B. $512.40
C. $555.40
D. $574.90
E. $588.20



In this case I suppose we can do the following
the statue was sold at the price P - $670
the COGS (cost of goods) = 100%
the sell price = 135%

another words [$670][/1.35] = 496.|2962|

nevertheless Mike right with the assumption about this problem.

Also Mike thanx for Magoosh ))
It is just few days past as I become premium subscriber.
Great explanations
I've started with dividing by 5 and have already won my girl-friend in mini-contest)))
I was equiped with a technique compared with she who has just an upper quantitative abilities.
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Re: Jim is able to sell a hand-carved statue for $670 which was [#permalink] New post 11 Dec 2012, 07:24
I did this...

670 is the final price that is the selling price. now suppose, x is the cost price.
therefore 670 = 1.35 * x
now while doing x = 670/1.35 calculation. I saw that the answer choices begin with 5.
So i did 135 * 5 = 675. As 670 is less than 675. Therefore the quotient will be less than 5.
Which is only in the answer A.
Re: Jim is able to sell a hand-carved statue for $670 which was   [#permalink] 11 Dec 2012, 07:24
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