Bradley Metalworks was founded in 1950. This company produces a variet

Question

Bradley Metalworks was founded in 1950. This company produces a variety of steel products for home and industrial use. Bradley buys raw iron from industries that extract iron from ore. Throughout its operation, Bradley has adjusted its prices to make, on average, about $500 of profit through every ton of raw iron it transforms into part of a finished steel product. Bradley Metalworks buys 6,000 tons of raw iron each year for each factory it has in existence. It started with one factory in 1950, and added a new factory at the beginning of each of the following years: 1962, 1972, 1979, 1985, 1989, 1992, 1995, and 1998. Starting in the year 2000, it opened a new factory at the beginning of every new year. Every year of its operation, Bradley Metalworks has been successful as a business, insofar as it has been able to use up all the raw iron it buys in steel products that it has been able to sell at its desired price.

Bradley Metalworks can buy raw iron from three manufacturers: Vulcan Incorporated, Ferric Industries, and Hematitic Suppliers. The first two were in existence from before the first year of Bradley Metalworks. Vulcan Incorporated closed in 1990, but the other two are still in operation. Hematitic Suppliers began business in 1965.

Gemmie · Accepted Answer

The number of Bradley factories
1950: 1
1962: 2
1972: 3
1979: 4
1985: 5
1989: 6
1992: 7
1995: 8
1998: 9
2000: 10
2001: 11
...

1. For the following statements, if we can conclude the statement is true based on the information provided, then respond True. Otherwise, respond False. 
 
 If Bradley Metalworks always bought raw iron at the lowest available price, it would have bought at least some raw iron from Hematitic in each year of the latter's existence. => True
 
 Every year since 1965 when H started its operation, H's price is always the lowest except for 1990 
 In 1990, however,
 
 V only sold 20k tons but Bradley 6 factories, meaning that it needs to buy 6 * 60k = 36k tons 
 Therefor, Bradley needs to buy some from the one with 2nd lowest price, which is H     
 The first year in which Bradley Metalworks achieved a profit of $24,000,000 was 1998. => False
 
 Profit of each factory is 500 * 6000 = 3,000,000 ($) 
 The number of factories needed in order to achieve $24 million profit =>  \frac{24}{3} = 8  
 1995 is the first year when Bradley had 8 factories   
 In 2005, a switch from Hematitic to Ferric would have cost Bradley Metalworks more than $150,000 in what it paid for raw iron. => False
 
 In 2005, Bradley had 15 factories => needing to buy 15 * 6000 = 90,000 tons 
 In 2005, switching form H to F will cost Bradley $1 (=28-27) per ton  
 => The total additional cost would be $90,000     
 2. In 1980, Bradley Metalworks bought all raw iron from Vulcan Industries. How much did Bradley spend that year in purchasing this raw iron?

In 1980, Bradlye had 4 factories => need to buy 4 * 6,000 = 24,000
=> Total cost is 30 * 24,000 = 720,000 ($)

t0nyt0ny · Answer

Hey! Any official solutions for these? Thank you.

Pallavimalik2597 · Answer

2. In 1980, Bradley owned 4 factories (1950,1962,1972,1979)

Each factory required 6000 tons
In total 6000*4=24000 tons
Price =30

Total cost=24000*30=720000

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Aryaa03 · Answer

Sajjad1994  
For 1st question - In 1990, price offered by Vulcan was 15 (with an asterix for which no note has been given), which is lower than that provided by Hematitic. 
Wouldn't it be one case where Bradley Metalwork's going to prefer a cheap deal from a business which is shutting down?

Elite097 · Answer

Sajjad1994  pls post explanation for Q1

Sajjad1994 · Answer

Official Explanation

1. For the following statements, if we can conclude the statement is true based on the information provided, then respond True. Otherwise, respond False.

https://gmatclub.com/forum/download/fil ... w&id=74843

Attachments

OE Bradley Metalworks 1.mp4 [6.61 MiB]
Downloaded 647 times

Sajjad1994 · Answer

Official Explanation

2. In 1980, Bradley Metalworks bought all raw iron from Vulcan Industries. How much did Bradley spend that year in purchasing this raw iron?

https://gmatclub.com/forum/download/fil ... w&id=74844

Attachments

OE Bradley Metalworks 2.mp4 [1.31 MiB]
Downloaded 248 times

Aryaa03 · Answer

Sajjad1994  Thank you for the explanation. 
I can't find the note explaining the * (asterisk) in Card-2. 
Does anyone have a clue?

Sajjad1994 · Answer

It is provided in bottom of the 2nd tab ;)

PSKhore · Answer

I missed on reading the first factory in 1950, and it led to a series of miscalculations by missing 6000 ton in every question! This was the TRAP I guess

Harsh07112001 · Answer

Yeah but requirement for that year is 36000 tons since he will be having 6 operational factories by then each producing 6000 tons. And its mentioned that Vulcan in 1990 will provide 20000 tons only.

Riyaagoell · Answer

In the second part of the first question, why did you divide 24 by 3?

egmat · Answer

Hi Riyaagoell,

Good question. The "24" and the "3" are both dollar amounts in  millions , and the division is really asking  "how many factories do we need to reach that total profit?"

Here is where each number comes from, all from  Card #1 (the text tab) :

- Bradley makes about  $500  profit per ton.
- Each factory uses  6,000  tons per year.
- So each factory earns  $500  x  6,000  =  $3,000,000  in profit per year.

That  $3,000,000  is the "3" (in millions). The target in the statement is  $24,000,000  - the "24."

So the question becomes: how many blocks of  $3,000,000  make up  $24,000,000 ?

$24,000,000  /  $3,000,000  =  8

That means Bradley needs  8  factories running to hit  $24,000,000  in profit. From the factory list, the  8th  factory opened in  1995  - not  1998  - which is why the statement is  False .

The quick way to see it

Think of each factory as a fixed "profit unit" of  $3M . To find how many units add up to a target, you divide the target by the size of one unit. That's all the  24  /  3  is doing.

A tiny parallel: if one machine earns  $2  a day and you want  $10  a day total, you need  $10  /  $2  =  5  machines. Same move here - just with  $3M -per-factory instead of  $2 -per-machine.

So the division isn't a trick; it's just "total profit needed / profit from one factory = number of factories."

Answer: True, False, False

	$540,000
	$720,000
	$900,000
	$1,800,000
	$3,600,000

Bradley Metalworks was founded in 1950. This company produces a variet

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True	False
		If Bradley Metalworks always bought raw iron at the lowest available price, it would have bought at least some raw iron from Hematitic in each year of the latter's existence.
		The first year in which Bradley Metalworks achieved a profit of $24,000,000 was 1998.
		In 2005, a switch from Hematitic to Ferric would have cost Bradley Metalworks more than $150,000 in what it paid for raw iron.

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Bradley Metalworks was founded in 1950. This company produces a variet

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