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08 Jan 2018, 22:45
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John and Ed work for the same Sales Company. John receives a $600 basic salary plus 20 percent of any profit he realizes for the company in excess of$5,000, while Ed receives an $800 basic salary in addition to 40 percent of any profit he realizes for the company only if the total profit he realizes is greater than$8,000, otherwise he receives a flat salary of $1,000. For what amount of profit will both John and Ed earn the same amount? A.$1,000
B. $1,200 C.$2,400
D. $6,000 E.$7,000
[Reveal] Spoiler: OA

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John and Ed work for the same Sales Company. John receives a $600 basi [#permalink] ### Show Tags 09 Jan 2018, 00:11 1 This post received KUDOS Bunuel wrote: John and Ed work for the same Sales Company. John receives a$600 basic salary plus 20 percent of any profit he realizes for the company in excess of $5,000, while Ed receives an$800 basic salary in addition to 40 percent of any profit he realizes for the company only if the total profit he realizes is greater than $8,000, otherwise he receives a flat salary of$1,000. For what amount of profit will both John and Ed earn the same amount?

A. $1,000 B.$1,200
C. $2,400 D.$6,000
E. $7,000 John's salary is 600$ + 20% of the profit of sales > $5000 Ed's salary is 800$ + 40% of the profit of sales > $8000(Else, he receives a flat salary of$1000)

Since the basic salary of John is 600$and he receives 20% over 5000$ in profit,
in order to make the earnings equal, $$0.2*(x-5000) + 600 = 1000$$
The reason Ed's earning will not be greater than the flat rate of $1000 is because Ed earns 40% of the sales, where as John earns only 20% of the sales $$.2*(x-5000) = 400 => x-5000 = 2000 => x =$$ 7000(Option E) _________________ Stay hungry, Stay foolish 2017-2018 MBA Deadlines Class of 2020: Rotman Thread | Schulich Thread Class of 2019: Sauder Thread Manager Joined: 23 Oct 2017 Posts: 65 Re: John and Ed work for the same Sales Company. John receives a$600 basi [#permalink]

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09 Jan 2018, 20:18
Based on the problem stmt:
J = 600 + 20%(P-5000) where P is the profit, and J is the salary recieved by John

E = 800 + 40% of P (if P >8000)
else E=1000

lets see if for any value of P we can have J = E .. on solving we get P=7000