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:

Next year, a certain executive will receive a 15-percent [#permalink]
06 Sep 2004, 20:49

00:00

A

B

C

D

E

Difficulty:

(N/A)

Question Stats:

0% (00:00) correct
0% (00:00) wrong based on 0 sessions

This topic is locked. If you want to discuss this question please re-post it in the respective forum.

Next year, a certain executive will receive a 15-percent increase in base salary, but will no longer receive her $8000 yearly bonus. If next year's salary represents a 7-percent net increase in income from this year, what is this year's base salary?

A) 100,000
B) 105,000
C) 107,000
D) 115,000
E) 123,050

My answer is 107000 as well, but after I saw the solutions from ywilfred and jimishg, I have a question for you guys:

What is your definition of income? Do you agree or disagree the following

Income = Base salary + Bonus

If bonus does not account for your income, then how do we call it?

This is where we can two different answers. For people who get 107000, we treat bonus as a portion of income; for people who get 100000, they think bonus is not a part of income.

We need OA, pls!

Last edited by jinino on 07 Sep 2004, 19:36, edited 1 time in total.

The reason is that in the question it is mentioned that the person in the second year will not get his or her yearly bonus of $ 8000. Therefore I believe the bonus will not be part of the income as I assume the bonus is yearly fixed on $ 8000.

Six figure salaries are interesting, so this question interests me. (115/100)X - 8000 = (107/100)X X=100,000

I too did like this and got it wrong. The mistake in this is that we are subtracting the non-existant boonus from next years salary, whereas it should be added with current year's salary to make it an "income".

OA is (C) 107,000. Anuramm's method is simple and correct.

anuramm wrote:

Let this years base salary be x. then 1.07 (x + 8000 ) = 1.15x x= 107000,hence C.

jinino wrote:

What is your definition of income? Do you agree or disagree the following: Income = Base salary + Bonus

Next year, a certain executive will receive a 15-percent increase in base salary, but will no longer receive her $8000 yearly bonus. If next year's salary represents a 7-percent net increase in income from this year, what is this year's base salary?

Let this years base salary = x
Total income this year = x + 8000
Total income next year = 1.15x