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

It is currently 22 Sep 2014, 04:42

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

On jane's credit card account, the average daily balance for

  Question banks Downloads My Bookmarks Reviews Important topics  
Author Message
TAGS:
Manager
Manager
avatar
Joined: 13 Jan 2009
Posts: 173
Schools: Harvard Business School, Stanford
Followers: 4

Kudos [?]: 16 [0], given: 9

GMAT Tests User
On jane's credit card account, the average daily balance for [#permalink] New post 02 Sep 2009, 02:05
00:00
A
B
C
D
E

Difficulty:

(N/A)

Question Stats:

33% (01:28) correct 67% (02:09) wrong based on 10 sessions
On jane's credit card account, the average daily balance for a 30-day billing cycle is the average of the daily balances at the end of each of the 30 day. At the beginning of a certain 30-day billing cycle, Jane's credit card account had a balance of $600. Jane made a payment of $300 on the account during the billing cycle. If no other amounts were added to or subtracted from the account during the billing cycle, what was the average daily balance on Jane's account for the billing cycle?

(1) Jane's payment was credited on the 21st day of the billing cycle.
(2) Average daily balance through the 25th day of the billing cycle was $450.

[Reveal] Spoiler:
D
Senior Manager
Senior Manager
avatar
Joined: 23 Jun 2009
Posts: 359
Location: Turkey
Schools: UPenn, UMich, HKS, UCB, Chicago
Followers: 5

Kudos [?]: 95 [0], given: 60

GMAT Tests User
Re: jane's credit card account [#permalink] New post 02 Sep 2009, 02:13
1)suff.
balance of first 20 days are 600, last 10 days are 300. We can find average.
2)suff.
balance of first 25 days are 450, last 5 days are 300. We can find average.

D.
Director
Director
User avatar
Joined: 01 Apr 2008
Posts: 909
Schools: IIM Lucknow (IPMX) - Class of 2014
Followers: 15

Kudos [?]: 216 [0], given: 18

GMAT Tests User
Re: jane's credit card account [#permalink] New post 02 Sep 2009, 09:55
maliyeci wrote:
1)suff.
balance of first 20 days are 600, last 10 days are 300. We can find average.
2)suff.
balance of first 25 days are 450, last 5 days are 300. We can find average.

D.

for stmt2 we cannot say that last 5 days the balance is 300.
Since the average balance is less than 600 for the first 25 days, the 300 credit has already been made on one of the days from 1-25.

However, if we consider the average for the first 25 days to be 450 then we can find the exact day on which the credit of 300 was made using:

(n-1)*600 + [ 25-(n-1)]*300 / 25 = 450, where n is the day on which 300 was credited
no need to calculate, but once we get this exact day we can calculate the monthly average since for n days balance was 600 and rest 30-n days the balance was 300...just like in stmt 1
Manager
Manager
avatar
Joined: 10 Aug 2009
Posts: 130
Followers: 3

Kudos [?]: 54 [0], given: 10

Re: jane's credit card account [#permalink] New post 02 Sep 2009, 10:30
Economist wrote:
maliyeci wrote:
1)suff.
balance of first 20 days are 600, last 10 days are 300. We can find average.
2)suff.
balance of first 25 days are 450, last 5 days are 300. We can find average.

D.

for stmt2 we cannot say that last 5 days the balance is 300.
Since the average balance is less than 600 for the first 25 days, the 300 credit has already been made on one of the days from 1-25.

However, if we consider the average for the first 25 days to be 450 then we can find the exact day on which the credit of 300 was made using:

(n-1)*600 + [ 25-(n-1)]*300 / 25 = 450, where n is the day on which 300 was credited
no need to calculate, but once we get this exact day we can calculate the monthly average since for n days balance was 600 and rest 30-n days the balance was 300...just like in stmt 1



I agree with the answer D. However, I think you can make it easier by calculating the balance directly:
\frac{25\times 450+5\times 300}{30}=425

But this value (425) contradicts the balance of 500 from stmt 1. I think the balance in statement 2 is wrong...it should be 540...that is the only value for the first 25 days that will give the average 30 day balance of 500.
Director
Director
User avatar
Joined: 01 Apr 2008
Posts: 909
Schools: IIM Lucknow (IPMX) - Class of 2014
Followers: 15

Kudos [?]: 216 [0], given: 18

GMAT Tests User
Re: jane's credit card account [#permalink] New post 02 Sep 2009, 10:57
LenaA wrote:
Economist wrote:
maliyeci wrote:
1)suff.
balance of first 20 days are 600, last 10 days are 300. We can find average.
2)suff.
balance of first 25 days are 450, last 5 days are 300. We can find average.

D.

for stmt2 we cannot say that last 5 days the balance is 300.
Since the average balance is less than 600 for the first 25 days, the 300 credit has already been made on one of the days from 1-25.

However, if we consider the average for the first 25 days to be 450 then we can find the exact day on which the credit of 300 was made using:

(n-1)*600 + [ 25-(n-1)]*300 / 25 = 450, where n is the day on which 300 was credited
no need to calculate, but once we get this exact day we can calculate the monthly average since for n days balance was 600 and rest 30-n days the balance was 300...just like in stmt 1



I agree with the answer D. However, I think you can make it easier by calculating the balance directly:
\frac{25\times 450+5\times 300}{30}=425

But this value (425) contradicts the balance of 500 from stmt 1. I think the balance in statement 2 is wrong...it should be 540...that is the only value for the first 25 days that will give the average 30 day balance of 500.


I think you have assumed that for the last 5 days the balance was 300. This is only possible if on the 25th day 300 was credited into the account.
At the beginning of the month bal was 600, on 25th day the average balance reduced, which means that the 300 credit has taken place in the first 25 days (not necessarily on the 25th day)...if it was on the first day itself then average will be less, if it is on 24th day for example then average will be higher. So in any case we need to find the exact day on which 600 became 600-300=300.

Anyhow, the answer is D.
1 KUDOS received
Manager
Manager
avatar
Joined: 10 Aug 2009
Posts: 130
Followers: 3

Kudos [?]: 54 [1] , given: 10

Re: jane's credit card account [#permalink] New post 02 Sep 2009, 11:22
1
This post received
KUDOS
I did not assume that. I assumed that the charge ocurred during the first 25 days

If you denote x_i to be the balance on the day i, i={1,2,...30},

\frac{\sum_{i=1}^{25} x_i}{25}=450

\sum_{i=1}^{25} x_i=450\times 25

\frac{\sum_{i=1}^{30} x_i}{30}=\frac{\sum_{i=1}^{25} x_i+\sum_{i=26}^{30} x_i}{30}=\frac{450\times 25 + 300\times 5}{30}

Am i missing something
Manager
Manager
avatar
Joined: 25 Aug 2009
Posts: 177
Followers: 1

Kudos [?]: 59 [0], given: 12

GMAT Tests User
Re: jane's credit card account [#permalink] New post 02 Sep 2009, 15:09
LenaA wrote:
I did not assume that. I assumed that the charge ocurred during the first 25 days

If you denote x_i to be the balance on the day i, i={1,2,...30},

\frac{\sum_{i=1}^{25} x_i}{25}=450

\sum_{i=1}^{25} x_i=450\times 25

\frac{\sum_{i=1}^{30} x_i}{30}=\frac{\sum_{i=1}^{25} x_i+\sum_{i=26}^{30} x_i}{30}=\frac{450\times 25 + 300\times 5}{30}

Am i missing something


Totally agree..Hats off to you SigmA LenaA :)
Economists :- I think you are thinking too much in this problem..it does not matter on which day payment was made in statement 2. We know that average is less than 600 and we know the number of days and average..
whether the payment made on 1st day, 2nd day or the 25th day..it does not matter..Sum of daily averages will be equal in all the cases if given average is constant..

one more thing guys :- if statememt 1 and statement 2 gives different answers , it does not mean something is wrong..it is possible in GMAT that by solving both statements, you can get different answers, however, it is very rare but possible..
Director
Director
User avatar
Joined: 01 Apr 2008
Posts: 909
Schools: IIM Lucknow (IPMX) - Class of 2014
Followers: 15

Kudos [?]: 216 [0], given: 18

GMAT Tests User
Re: jane's credit card account [#permalink] New post 02 Sep 2009, 19:25
LenaA wrote:
I did not assume that. I assumed that the charge ocurred during the first 25 days

If you denote x_i to be the balance on the day i, i={1,2,...30},

\frac{\sum_{i=1}^{25} x_i}{25}=450

\sum_{i=1}^{25} x_i=450\times 25

\frac{\sum_{i=1}^{30} x_i}{30}=\frac{\sum_{i=1}^{25} x_i+\sum_{i=26}^{30} x_i}{30}=\frac{450\times 25 + 300\times 5}{30}

Am i missing something

You are right in a way that you are trying to calculate the weighted average, this is what the question asks. BUT we DO NOT know the values in the second set (26-30).
Lets take your approach,

For the first 25 days the av balance was 450...meaning on the ...22,23,24 day the balance can be 450,450,450 or it can be 300,300,300..or any value depending on when the 300 was credited. Now as per your formula you took 300 as the average value for 26-30 days which is a problem. How did the balance suddenly reduce/increase if no transactions were made from 25-30 days? :)

We can use the above formula only if we know all values in both the sets. I hope I answered your question.
Senior Manager
Senior Manager
avatar
Joined: 23 Jun 2009
Posts: 359
Location: Turkey
Schools: UPenn, UMich, HKS, UCB, Chicago
Followers: 5

Kudos [?]: 95 [0], given: 60

GMAT Tests User
Re: jane's credit card account [#permalink] New post 02 Sep 2009, 23:40
Economist, your missing point in the problem is that wording in option II (Average daily balance through the 25th day of the billing cycle was $450)
it is through not for ;)
1 KUDOS received
Manager
Manager
avatar
Joined: 17 Aug 2009
Posts: 238
Followers: 4

Kudos [?]: 89 [1] , given: 25

GMAT Tests User
Re: jane's credit card account [#permalink] New post 19 Nov 2009, 05:07
1
This post received
KUDOS
The question can be quite intimidating, but look closely and you will get the right meaning
What it says is that Jane’s average daily balance for a 30 day period is equal to (the sum of Jane’s balance on each day)/no. of days

Here Jane’s month starts off with 600$ and somewhere along the line she makes a payment of 300$. If we know, when she makes that payment we will be able to calculate her avg daily balance. Now, lets look at the statements

Statement A – Says that she makes the payment on the 21st day. Therefore, her avg daily balance is –
(600*20 + 10*300)/30 = SUFFICIENT

Statement B – Says that the avg daily balance that Jane has on the 25th day is 540$, which means that Jane has made the payment of 300$ somewhere in the middle of those 25 days.
We can calculate that day by –

(x*600 + (25-x)540)/25 = 540
Knowing x from the above equation, will lead us to the Daily balance

Hope this helps
Manager
Manager
avatar
Joined: 30 Jun 2004
Posts: 178
Location: Singapore
Followers: 1

Kudos [?]: 11 [0], given: 5

GMAT ToolKit User GMAT Tests User
Re: jane's credit card account [#permalink] New post 29 May 2010, 17:40
Can anyone kindly suggest the difficulty level of this problem?
Intern
Intern
User avatar
Status: "You never fail until you stop trying." ~Albert Einstein~
Joined: 16 May 2010
Posts: 31
Followers: 0

Kudos [?]: 4 [0], given: 7

Re: jane's credit card account [#permalink] New post 23 May 2011, 12:58
D. The average daily balance through the 25th day of the billing cycle was 540. (Suff)

Approach 1-600(25-x)+300(x)/25=540--> X represent the amount of days left ending balance of 300. Add 5 more days with a balance of 300 to get the total daily balance and divide by 30 days.

Approach 2- Average of 540--> 600 is 60 away from avg while 300 is 240 away-->So ratio of the difference can be expressed as 60:240 or 1:4 ---> Since 600 is the larger of the group value it takes on the larger portion. So you can conclude that 600 daily balances make up 4/5 of the average days and that 300 daily balances make up 1/5 of the average days.
VP
VP
avatar
Status: There is always something new !!
Affiliations: PMI,QAI Global,eXampleCG
Joined: 08 May 2009
Posts: 1365
Followers: 12

Kudos [?]: 140 [0], given: 10

GMAT Tests User
Re: jane's credit card account [#permalink] New post 24 May 2011, 01:08
D it is.

since there is just one transaction the question stem itself gives a clear answer here.
_________________

Visit -- http://www.sustainable-sphere.com/
Promote Green Business,Sustainable Living and Green Earth !!

Senior Manager
Senior Manager
avatar
Joined: 29 Jan 2011
Posts: 386
Followers: 0

Kudos [?]: 38 [0], given: 87

GMAT Tests User
Re: jane's credit card account [#permalink] New post 10 Jul 2011, 03:57
Can someone explain what the question says ? and simplify what its asking?
Re: jane's credit card account   [#permalink] 10 Jul 2011, 03:57
    Similar topics Author Replies Last post
Similar
Topics:
On Jane's credit card account, the average daily balance for yhc25 1 15 Dec 2008, 21:03
On jane's credit card account, the average daily balance for FN 8 14 Jul 2008, 07:48
On Jane's credit card account, the average daily balance for lexis 6 04 May 2008, 04:14
on Jane s credit card account, the average daily balance for sondenso 1 24 Feb 2008, 17:58
On Jane's credit card account, the average daily balance for above720 1 23 Aug 2007, 17:30
Display posts from previous: Sort by

On jane's credit card account, the average daily balance for

  Question banks Downloads My Bookmarks Reviews Important topics  


GMAT Club MBA Forum Home| About| Privacy Policy| 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®.