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Jackson Consulting reduced headcount by laying off 20% of its employee

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Jackson Consulting reduced headcount by laying off 20% of its employee [#permalink]

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Jackson Consulting reduced headcount by laying off 20% of its employees. If the earnings of each of the remaining employees were the same before and after the layoffs, what is the maximum percentage by which the average earnings of the employees at the company could have increased from its level before the layoffs to its level after the layoffs?

(A) 15
(B) 16
(C) 20
(D) 25
(E) 40

Source: Marty Murray
[Reveal] Spoiler: OA

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Re: Jackson Consulting reduced headcount by laying off 20% of its employee [#permalink]

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New post 09 Apr 2016, 00:49
MartyMurray wrote:
Jackson Consulting reduced headcount by laying off 20% of its employees. If the earnings of each of the remaining employees were the same before and after the layoffs, what is the maximum percentage by which the average earnings of the employees at the company could have increased from its level before the layoffs to its level after the layoffs?

(A) 15
(B) 16
(C) 20
(D) 25
(E) 40

Source: Marty Murray


hi,
since we are looking to maximize the average with no change in earnings..
Let all the layed off employees were ding Social service :wink: that is they were working without any pay..

so if all 100%,say 100 earlier were earning 100 with average = 1..
Now 80% are earning 100 so average = 100/80 = 1.25..
increase = 1.25-1= .25
% = .25/1*100 = 25%
D
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Re: Jackson Consulting reduced headcount by laying off 20% of its employee [#permalink]

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Re: Jackson Consulting reduced headcount by laying off 20% of its employee [#permalink]

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New post 28 Aug 2017, 01:41
MartyMurray wrote:
Jackson Consulting reduced headcount by laying off 20% of its employees. If the earnings of each of the remaining employees were the same before and after the layoffs, what is the maximum percentage by which the average earnings of the employees at the company could have increased from its level before the layoffs to its level after the layoffs?

(A) 15
(B) 16
(C) 20
(D) 25
(E) 40

Source: Marty Murray



Let employees before layoff be 100 earning 1 Unit per employee.
After layoff number of employees =80 (Still earning 100 units)
Hence earning per employee = 100/80=5/4
5/4=1*(1/4)

1/4 is the increase and it corresponds to 25% increase.

Hence answer is D

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Re: Jackson Consulting reduced headcount by laying off 20% of its employee [#permalink]

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New post 31 Aug 2017, 10:22
MartyMurray wrote:
Jackson Consulting reduced headcount by laying off 20% of its employees. If the earnings of each of the remaining employees were the same before and after the layoffs, what is the maximum percentage by which the average earnings of the employees at the company could have increased from its level before the layoffs to its level after the layoffs?

(A) 15
(B) 16
(C) 20
(D) 25
(E) 40


We can assume that before the layoffs, Jackson Consulting (JC) has 10 employees and each is paid, on average, $100. Thus, the total payroll would be 10 x 100 = $1000. Since JC lays off 20% of its employees, it lays off 2 employees and we have 8 employees left. To maintain the total payroll of $1000, each of the 8 employees, on average, would be paid 1000/8 = $125.

We see that the average employee earnings of $125 after the layoffs is 25% more than the average employee earnings of $100 before the layoffs.

Answer: D
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Re: Jackson Consulting reduced headcount by laying off 20% of its employee   [#permalink] 31 Aug 2017, 10:22
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