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:

At a certain supplier, a machine of type A costs $20,000 and [#permalink]

Show Tags

17 Jul 2010, 11:41

3

This post was BOOKMARKED

00:00

A

B

C

D

E

Difficulty:

65% (hard)

Question Stats:

69% (03:18) correct
31% (02:19) wrong based on 197 sessions

HideShow timer Statistics

At a certain supplier, a machine of type A costs $20,000 and a machine of type B costs $50,000. Each machine can be purchased by making a 20 percent down payment and repaying the remainder of the cost and the finance charges over a period of time.If the finance charges= 40 percent of the rremainderof the cost, how much less would 2 machines of type A cost than 1 machine of type B?

A. $10,000 B. $11,200 C. $12,000 D. $12,800 E. $13,200

At a certain supplier, a machine of type A costs $20,000 and a machine of type B costs $50,000. Each machine can be purchased by making a 20 percent down payment and repaying the remainder of the cost and the finance charges over a period of time.If the finance charges= 40 percent of the rremainderof the cost, how much less would 2 machines of type A cost than 1 machine of type B?

a. $10,000 b. $11,200 c. $12,000 d. $12,800 e. $13,200

1 machine of type B will cost: 20% down payment of 50,000 = 10,000 plus remaining sum (50,000-10,000=40,000) with 40% of finance charges 40,000*1.4=56,000 --> 10,000+56,000=66,000;

2 machine of type A will cost: 20% down payment of 2*20,000 = 8,000 plus remaining sum (40,000-8,000=32,000) with 40% of finance charges 32,000*1.4=44,800 --> 8,000+44,800=52,800;

2 A type machines cost: 40000. 20% down payment: 40000/5 = 8000 Remainder: 40000-8000=32000 Financial charges on remainder=32000*40/100=12800 Total money spent for 2 type A's = 12800+8000+32000=52800

1 B type machine cost: 50000 20% down payment: 50000/5=10000 Remainder: 50000-10000=40000 Financial charges on remainder=40000*40/100=16000 Total money spent for 1 type B = 16000+10000+40000=66000

Can someone please explain tough PS question from gmat prep.

Please find screenshot attached in the word doc file.

Many thanks.

The cost of 2 machines of type A is 40,000 while the cost of one machine of type B is 50,000. The down payment and rate of interest are the same for both the cases. So all expenses will be same for both the cases except for the extra 10,000 to be paid in case of machine B and extra interest calculated as 40% of 8000 = 3200 (because out of 10,000, 20% down payment is 2000 and rest 8000 is the loaned amount) So we need to pay a total of 13,200 extra in case of machine B.
_________________

E as well. Although, is it ok to consider total cost at the end of payment period when there is no specific mention abt it?

Yes, it will be the cost at the end of the period. The question stem says "how much less would 2 machines of type A cost than 1 machine of type B?"

Consider this: I want to buy a car - either a Camry or an Accord Camry down payment 20%, 6% interest on rest Accord down payment 15%, 6% interest on rest price of Camry $$$, Price of Accord $$$ etc etc.... How much less would an Accord cost as compared to Camry?

Re: At a certain supplier, a machine of type A costs $20,000 and [#permalink]

Show Tags

27 Jun 2013, 00:46

fozzzy wrote:

Why do we multiply by 1.4 and not .4.. Please explain

It depends on the numbers you choose.

40% is applicable on the amount not paid already. Thus, you can have :

50000 + 0.4*40000 = 66000 [ We have anyways added the complete cost of the machine i.e. 50000, however, 40% on the amount which was not paid as down-payment is to be added]

Or

you can have 10000 + 1.4*40000 = 10000+(1+0.4)*40000 = 10000+40000+0.4*40000 = 50000+0.4*40000 ; this is exactly what we have above = 66000[ 50000 can be split in to two amounts; 10000 denotes the down-payment with no interest and the remaining 40000 with an interest of 40%]

Either ways, it is the same thing.
_________________

Re: At a certain supplier, a machine of type A costs $20,000 and [#permalink]

Show Tags

18 Jul 2013, 11:39

A = 40,000 DP = 40,000*(20/100) = 8,000 Remaining = 32,000 F = R*(40/100) F = 32,000*(40/100) = 12,800 C = DP + F + R C = 8,000 + 12,800 + 32,000 C = 52,800

B = 50,000 DP = 50,000*(20/100) = 10,000 R = 40,000 F = 40,000*(40/100) = 16,000 C = 10,000 + 16,000 + 40,000 C = 66,000

Re: At a certain supplier, a machine of type A costs $20,000 and [#permalink]

Show Tags

09 Jul 2016, 01:22

EnterMatrix wrote:

At a certain supplier, a machine of type A costs $20,000 and a machine of type B costs $50,000. Each machine can be purchased by making a 20 percent down payment and repaying the remainder of the cost and the finance charges over a period of time.If the finance charges= 40 percent of the remainder of the cost, how much less would 2 machines of type A cost than 1 machine of type B?

A. $10,000 B. $11,200 C. $12,000 D. $12,800 E. $13,200

Okay..I tried to reduce the amount of calculations..here's me take.. After all..how much do we have to pay?

20% down payment done.. we're left with 80%..on which 40% interest is accrued..in other words..112%

Total amount to be paid..in each case..is 112% + 20% = 132% of the actual value

Its been long time coming. I have always been passionate about poetry. It’s my way of expressing my feelings and emotions. And i feel a person can convey...

Written by Scottish historian Niall Ferguson , the book is subtitled “A Financial History of the World”. There is also a long documentary of the same name that the...

Post-MBA I became very intrigued by how senior leaders navigated their career progression. It was also at this time that I realized I learned nothing about this during my...