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A lady sold two small investment properties, A and B, for $24,000 each

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Bunuel
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A lady sold two small investment properties, A and B, for $24,000 each [#permalink] New post   02 Dec 2014, 09:13
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A lady sold two small investment properties, A and B, for $24,000 each. If she sold property A for 20 percent more than she paid for it, and sold property B for 20 percent less than she paid for it, then, in terms of the net financial effect of these two investments (excluding taxes and expenses), we can conclude that the lady

A) broke even
B) had an overall gain of $1,200
C) had an overall loss of $1,200
D) had an overall gain of $2,000
E) had an overall loss of $2,000

Source: Chili Hot GMAT
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E
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Re: A lady sold two small investment properties, A and B, for $24,000 each [#permalink] New post   02 Dec 2014, 10:14
Let's look at the investments individually.

A was sold for 20% more than it was bought for. This means $24,000 equals 120% of the buy price (means she bought it for $20,000).
B was sold for 20% less than it was bought for. This means $24,000 equals 80% of the buy price (means she bought it for $30,000).

Overall, she bought for $50,000 and sold for $48,000--netting a loss of $2,000.

E
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Re: A lady sold two small investment properties, A and B, for $24,000 each [#permalink] New post   02 Dec 2014, 20:10
Answer = E) had an overall loss of $2,000

Cost Price of 20% profit property \(= 24000 * \frac{100}{120} = 20000\)

Cost Price of 20% loss property\(= 24000 * \frac{100}{80} = 30000\)

Total cost price = 30000+20000 = 50000

Total sales price = 24000*2 = 48000

Loss = 50000-48000 = 2000
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A lady sold two small investment properties, A and B, for $24,000 each [#permalink] New post   Updated on: 08 Aug 2023, 00:19
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Bunuel wrote:

Tough and Tricky questions: Word Problems.



A lady sold two small investment properties, A and B, for $24,000 each. If she sold property A for 20 percent more than she paid for it, and sold property B for 20 percent less than she paid for it, then, in terms of the net financial effect of these two investments (excluding taxes and expenses), we can conclude that the lady

A) broke even
B) had an overall gain of $1,200
C) had an overall loss of $1,200
D) had an overall gain of $2,000
E) had an overall loss of $2,000

Kudos for a correct solution.

Source: Chili Hot GMAT



When two items are sold at the same selling price, one at a profit of x% and other at a loss of x%, we get an overall loss of (x^2/100)%
This is explained here in detail: https://anaprep.com/arithmetic-profit-o ... e-formula/

So with a 20% profit and 20% loss, and same selling price of $24000, we will get a loss of (20^2/100) % = 4%

Her overall selling price = 2 * 24000 and overall loss % is 4%.

Cost Price - 4% of Cost Price = 48,000
Cost Price = 50,000

Overall Loss = Cost price - Selling price = 50,000 - 48,000 = 2000

Originally posted by KarishmaB on 26 Jun 2023, 06:36.
Last edited by KarishmaB on 08 Aug 2023, 00:19, edited 1 time in total.
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Re: A lady sold two small investment properties, A and B, for $24,000 each [#permalink] New post   26 Jun 2023, 08:01
Bunuel wrote:
A lady sold two small investment properties, A and B, for $24,000 each. If she sold property A for 20 percent more than she paid for it, and sold property B for 20 percent less than she paid for it, then, in terms of the net financial effect of these two investments (excluding taxes and expenses), we can conclude that the lady

A) broke even
B) had an overall gain of $1,200
C) had an overall loss of $1,200
D) had an overall gain of $2,000
E) had an overall loss of $2,000

Source: Chili Hot GMAT

CP of Property 1 is \(\frac{24000}{120}*100 = 20000\)
CP of Property 2 is \(\frac{24000}{80}*100 = 30000\)

Total CP = 50000 ; Total SP = 48000

Thus the lady had a loss of 2000, Answer must be (E)
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Re: A lady sold two small investment properties, A and B, for $24,000 each [#permalink]
26 Jun 2023, 08:01
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