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

We can PLUG IN THE ANSWERS, which represent the amount of profit.

Since Ed earns a flat salary of $1000 if the amount of profit does not exceed $8000 -- and all of the answer choices are less than 8000 -- Ed's earnings = $1000.

Since John and Ed must earn the same amount, John must also earn $1000.

John earns a $600 base salary plus 20% of any profit in excess of $5000.

Thus, for John to earn $1000, the correct answer must be greater than 5000.

Eliminate A, B and C.

When the correct answer is plugged in, the amount of profit in excess of $5000 will yield John an additional $400 on top of his $600 base salary, bringing his total earnings to $1000.

D: 6000, implying $1000 profit in excess of $5000

Additional earnings for John = 20% of $1000 = 200.

Too small.

Eliminate D.

E: 7000, implying $2000 profit in excess of $5000

Additional earnings for John = 20% of $2000 = 400.

Success!

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