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# A company produces school bags. The cost for producing the first 1,000

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Math Expert
Joined: 02 Sep 2009
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A company produces school bags. The cost for producing the first 1,000  [#permalink]

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05 Nov 2019, 01:39
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Difficulty:

35% (medium)

Question Stats:

73% (02:08) correct 28% (02:21) wrong based on 80 sessions

A company produces school bags. The cost for producing the first 1,000 bags of a particular design, owing to initial expenses, turns out to be $30 per bag. Thereafter, the cost reduces to$10 per bag. If the company produced 5,000 bags of a certain design and sold them all at an average price of $20 per bag, which of the following will represent the best approximation for the percentage profit earned by the company on the expenses incurred in producing these bags? A. 10% B. 20% C. 30% D. 40% E. 50% Are You Up For the Challenge: 700 Level Questions _________________ Director Joined: 09 Aug 2017 Posts: 678 Re: A company produces school bags. The cost for producing the first 1,000 [#permalink] ### Show Tags 05 Nov 2019, 05:17 CP= (30*1000)+10(4000) = 70000 SP= 20*5000= 10000 Profit % = 3/7*100~43% D is closest and answer. VP Joined: 19 Oct 2018 Posts: 1294 Location: India Re: A company produces school bags. The cost for producing the first 1,000 [#permalink] ### Show Tags 05 Nov 2019, 06:05 Avg cost price of 5000 bags =$$\frac{1*30+4*10}{5}$$= 14 Avg SP of 5000 bags= 20 best approximation for the percentage profit earned by the company on the expenses incurred in producing these bags= $$\frac{20-14}{14} *100$$=43% Bunuel wrote: A company produces school bags. The cost for producing the first 1,000 bags of a particular design, owing to initial expenses, turns out to be$30 per bag. Thereafter, the cost reduces to $10 per bag. If the company produced 5,000 bags of a certain design and sold them all at an average price of$20 per bag, which of the following will represent the best approximation for the percentage profit earned by the company on the expenses incurred in producing these bags?

A. 10%
B. 20%
C. 30%
D. 40%
E. 50%

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Joined: 18 Aug 2017
Posts: 5723
Location: India
Concentration: Sustainability, Marketing
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Re: A company produces school bags. The cost for producing the first 1,000  [#permalink]

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05 Nov 2019, 06:58
CP = 3*10^4+4*10^4 ; 7*10^4
SP = 10^5
% profit = 10^5-7*10^4/ 7*10^4 ; 3/7 ; ~40%
IMO D

Bunuel wrote:
A company produces school bags. The cost for producing the first 1,000 bags of a particular design, owing to initial expenses, turns out to be $30 per bag. Thereafter, the cost reduces to$10 per bag. If the company produced 5,000 bags of a certain design and sold them all at an average price of $20 per bag, which of the following will represent the best approximation for the percentage profit earned by the company on the expenses incurred in producing these bags? A. 10% B. 20% C. 30% D. 40% E. 50% Are You Up For the Challenge: 700 Level Questions Board of Directors Status: QA & VA Forum Moderator Joined: 11 Jun 2011 Posts: 4860 Location: India GPA: 3.5 WE: Business Development (Commercial Banking) Re: A company produces school bags. The cost for producing the first 1,000 [#permalink] ### Show Tags 05 Nov 2019, 07:23 Bunuel wrote: A company produces school bags. The cost for producing the first 1,000 bags of a particular design, owing to initial expenses, turns out to be$30 per bag. Thereafter, the cost reduces to $10 per bag. If the company produced 5,000 bags of a certain design and sold them all at an average price of$20 per bag, which of the following will represent the best approximation for the percentage profit earned by the company on the expenses incurred in producing these bags?

A. 10%
B. 20%
C. 30%
D. 40%
E. 50%

Are You Up For the Challenge: 700 Level Questions

CP = 1000*30 + 4000*10 => 30000 + 40000 = 70000

SP = 5000*20 = 100000

So, Profit is 30000 ; Profit % is 3/7*100 ~ 40%, Answer must be (D)
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Re: A company produces school bags. The cost for producing the first 1,000  [#permalink]

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11 Nov 2019, 17:28
1
Bunuel wrote:
A company produces school bags. The cost for producing the first 1,000 bags of a particular design, owing to initial expenses, turns out to be $30 per bag. Thereafter, the cost reduces to$10 per bag. If the company produced 5,000 bags of a certain design and sold them all at an average price of $20 per bag, which of the following will represent the best approximation for the percentage profit earned by the company on the expenses incurred in producing these bags? A. 10% B. 20% C. 30% D. 40% E. 50% Are You Up For the Challenge: 700 Level Questions Since profit = revenue - cost, the profit is: 5000 x 20 - (1000 x 30 + 4000 x 10) 100,000 - (30,000 + 40,000) 100,000 - 70,000$30,000

Notice that the cost (or expenses) is \$70,000; so the profit is 30,000/70,000 = 3/7 ≈ 40% of the expenses.

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Re: A company produces school bags. The cost for producing the first 1,000   [#permalink] 11 Nov 2019, 17:28
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