Last visit was: 18 Nov 2025, 18:38 It is currently 18 Nov 2025, 18:38
Home
GMAT
Messages
Tests
Schools
Events
Rewards
Chat
My Profile
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.
Go to My Error Log Learn more
Close
Request Expert Reply
Confirm Cancel
Back to Forum
Create Topic
   1   2 
User avatar
KarishmaB
User avatar
Joined: 16 Oct 2010
Last visit: 18 Nov 2025
Posts: 16,265
Own Kudos:
76,982
 [2]
Given Kudos: 482
Location: Pune, India
Expert
Expert reply
Active GMAT Club Expert! Tag them with @ followed by their username for a faster response.
Posts: 16,265
Kudos: 76,982
 [2]
A used car dealer sold one car at a profit of 25 percent of 16 Jan 2022, 22:03
2
Kudos
Add Kudos
Bookmarks
Bookmark this Post
djdela
A used car dealer sold one car at a profit of 25 percent of the dealers purchase price for that car and sold another car at a loss of 20 percent of the dealers purchase price for that car. If the dealer sold each car for $20,000 , what was the dealers total profit or loss, in dollars, for the two transactions combined?

A. 1000 profit
B. 2000 profit
C. 1000 loss
D. 2000 loss
E. 3334 loss
Show more

himgkp1989
For profit and loss, the weights are always the cost price. It is possible to use weighted averages here though not worth the effort since we don't have CPs and will need to calculate those first.

Car1:
Profit = 25%, SP = 20k, CP = 20*(4/5) = 16k

Car 2:
Profit = -20%, SP = 20k, CP = 20*(5/4) = 25k

Cavg = (25 * 16k - 20*25k)/(16k + 25k) = -100/41%

Total CP = 16k + 25k = 41k

Profit/Loss amount \( = \frac{100}{41 *100} * 41k = -$1000\)

Answer (C)

I would prefer the logical approach I have discussed in a previous post.
User avatar
Archit3110
User avatar
Major Poster
Joined: 18 Aug 2017
Last visit: 18 Nov 2025
Posts: 8,423
Own Kudos:
4,979
Given Kudos: 243
Status:You learn more from failure than from success.
Location: India
Concentration: Sustainability, Marketing
GMAT Focus 1: 545 Q79 V79 DI73
GMAT Focus 2: 645 Q83 V82 DI81
GPA: 4
WE:Marketing (Energy)
GMAT Focus 2: 645 Q83 V82 DI81
Posts: 8,423
Kudos: 4,979
A used car dealer sold one car at a profit of 25 percent of 16 Jan 2022, 23:29
Kudos
Add Kudos
Bookmarks
Bookmark this Post
net selling price of both cars ; 40,000
Original price of the car which was sold with 25% profit ; 20,000/1.25 ; 16000
Original price of the car which was sold with loss of 20% ; 20,000/.8 ; 25000
Net buying cost of dealer ; 41,000
Net profit / loss; 40,000-41,000 ; 1,000
OPTION C

djdela
A used car dealer sold one car at a profit of 25 percent of the dealers purchase price for that car and sold another car at a loss of 20 percent of the dealers purchase price for that car. If the dealer sold each car for $20,000 , what was the dealers total profit or loss, in dollars, for the two transactions combined?

A. 1000 profit
B. 2000 profit
C. 1000 loss
D. 2000 loss
E. 3334 loss
Show more
User avatar
Ogunbiz
User avatar
Joined: 22 Sep 2021
Last visit: 13 Feb 2023
Posts: 4
Own Kudos:
1
 [1]
Given Kudos: 5
Location: Nigeria
Schools: Wharton '25 (A) Sloan '25 (A$) Kellogg '25 (A) Stanford (D)
GRE 1: Q168 V164
GPA: 3.65
Schools: Wharton '25 (A) Sloan '25 (A$) Kellogg '25 (A) Stanford (D)
GRE 1: Q168 V164
Posts: 4
Kudos: 1
 [1]
A used car dealer sold one car at a profit of 25 percent of 03 Mar 2022, 17:09
1
Kudos
Add Kudos
Bookmarks
Bookmark this Post
KarishmaB
djdela
A used car dealer sold one car at a profit of 25 percent of the dealers purchase price for that car and sold another car at a loss of 20 percent of the dealers purchase price for that car. If the dealer sold each car for $20,000 , what was the dealers total profit or loss, in dollars, for the two transactions combined?

a) 1000 profit
b) 2000 profit
c) 1000 loss
d) 2000 loss
e) 3334 loss

Logical approach:

Car 1 - profit of 25% i.e. 1/4 i.e. 1 part profit for 4 parts of cost price. So selling price ($20,000) has total 5 parts (each being $4000) out of which 1 part is profit i.e. $4000.
Car 2 - loss of 20% i.e. 1/5 i.e. 1 part of loss out of 5 parts of cost price was removed to get selling price ($20,000) which has 4 parts now. So each part is $5000 and the loss is 1 part i.e. $5000.

Overall, loss of $5000 - $4000 = $1000
Show more


Jeez, this just saved my life. So easy and elegant. I hope I see a profit/loss question on test days. It is simply ratios!!!!!!!!!
User avatar
MasteringGMAT
User avatar
Joined: 14 Feb 2022
Last visit: 11 Aug 2025
Posts: 79
Own Kudos:
2,710
Given Kudos: 69
Concentration: General Management, Strategy
Posts: 79
Kudos: 2,710
A used car dealer sold one car at a profit of 25 percent of 02 Jan 2023, 07:37
Kudos
Add Kudos
Bookmarks
Bookmark this Post
how can we solve this question using Weighted Average?
User avatar
jegego
User avatar
Joined: 18 Apr 2023
Last visit: 20 Oct 2023
Posts: 1
Posts: 1
Kudos: 0
A used car dealer sold one car at a profit of 25 percent of 20 Oct 2023, 02:29
Kudos
Add Kudos
Bookmarks
Bookmark this Post
Let's call the dealer's purchase price for the first car "P1" and the purchase price for the second car "P2."

According to the information provided:

The dealer sold the first car at a profit of 25 percent, which means the selling price of the first car is 125% of the purchase price: 1.25 * P1 = $20,000.
The dealer sold the second car at a loss of 20 percent, which means the selling price of the second car is 80% of the purchase price: 0.8 * P2 = $20,000.
Now, we can solve for P1 and P2:

1.25 * P1 = $20,000
P1 = $20,000 / 1.25
P1 = $16,000

0.8 * P2 = $20,000
P2 = $20,000 / 0.8
P2 = $25,000

So, the dealer purchased the first car for $16,000 and the second car for $25,000.

To calculate the dealer's total profit or loss, we need to find the difference between the total selling price and the total purchase price:

Total Selling Price = $20,000 (first car) + $20,000 (second car) = $40,000
Total Purchase Price = $16,000 (first car) + $25,000 (second car) = $41,000

Now, let's calculate the profit or loss:

Total Profit or Loss = Total Selling Price - Total Purchase Price
Total Profit or Loss = $40,000 - $41,000
Total Profit or Loss = -$1,000

So, the dealer incurred a total loss of $1,000 for the two transactions combined. The correct answer is option C: $1,000 loss.
User avatar
Pif96
User avatar
Joined: 24 Sep 2024
Last visit: 09 Jul 2025
Posts: 15
Own Kudos:
3
Given Kudos: 262
Posts: 15
Kudos: 3
A used car dealer sold one car at a profit of 25 percent of 27 Jan 2025, 03:17
Kudos
Add Kudos
Bookmarks
Bookmark this Post
Hi KarishmaB, why in this case the concept "
With the same selling price, if we have a profit of a% on one and a loss of a% on another, in all we always have a loss of (a^2/100)%" seems to not work?
And nobody here use it in this question
KarishmaB
VeritasKarishma
djdela
A used car dealer sold one car at a profit of 25 percent of the dealers purchase price for that car and sold another car at a loss of 20 percent of the dealers purchase price for that car. If the dealer sold each car for $20,000 , what was the dealers total profit or loss, in dollars, for the two transactions combined?

a) 1000 profit
b) 2000 profit
c) 1000 loss
d) 2000 loss
e) 3334 loss

Logical approach:

Car 1 - profit of 25% i.e. 1/4 i.e. 1 part profit for 4 parts of cost price. So selling price ($20,000) has total 5 parts (each being $4000) out of which 1 part is profit i.e. $4000.
Car 2 - loss of 20% i.e. 1/5 i.e. 1 part of loss out of 5 parts of cost price was removed to get selling price ($20,000) which has 4 parts now. So each part is $5000 and the loss is 1 part i.e. $5000.

Overall, loss of $5000 - $4000 = $1000

Quote:

I can understand “1 part profit for 4 parts of cost price“” by applying formula profit%=\frac{proft}{cost}

But I didn't fully understand how did you get "So selling price ($20,000) has total 5 parts (each being $4000) out of which 1 part is profit i.e. $4000"

Can you please elaborate more?

If for every 4 parts cost price, we have 1 part profit, what is the selling price in terms of parts?

Selling price = Cost price + Profit
Selling price = 4 parts + 1 part = 5 parts.

These 5 parts are actually $20,000 so each part must be 20,000/5 = $4000

Since cost price is 4 parts, it must be 4000*4 = $16,000
and since profit is 1 part, it must be 4000*1 = $4000
Show more
avatar
ManifestDreamMBA
avatar
Joined: 17 Sep 2024
Last visit: 18 Nov 2025
Posts: 1,282
Own Kudos:
784
Given Kudos: 236
Products:
GMAT Club Tests
Posts: 1,282
Kudos: 784
A used car dealer sold one car at a profit of 25 percent of 28 Jan 2025, 06:27
Kudos
Add Kudos
Bookmarks
Bookmark this Post
If one is to guess, it will be a loss as 125% of something (smaller vale) is equal to 80% of something else (larger value). So it eliminates A and B and increase odds of guessing the right answer
djdela
A used car dealer sold one car at a profit of 25 percent of the dealers purchase price for that car and sold another car at a loss of 20 percent of the dealers purchase price for that car. If the dealer sold each car for $20,000 , what was the dealers total profit or loss, in dollars, for the two transactions combined?

A. 1000 profit
B. 2000 profit
C. 1000 loss
D. 2000 loss
E. 3334 loss
Show more
   1   2 
Moderators:
Bunuel
Math Expert
105355 posts
Krunaal
Tuck School Moderator
805 posts