farukqmul wrote:

Katrina has a wheat business. She purchases wheat from a local wholesaler at a particular cost per pound. The price of the wheat at her stores is $3 per pound. Her faulty spring balance reads 0.9 pounds for a pound. Also, in the festival season, she gives a 10% discount on the wheat. She found that she made neither a profit nor a loss in the festival season. At what price did Katrina purchase the wheat from the wholesaler?

(A) 2.43

(B) 2.5

(C) 2.7

(D) 3

(E) 3.3

She made neither profit nor loss. So we have to find the actual selling price and we will get the cost price.

Selling price = 3

Then there are 2 discounts: 10% and the discount due to the faulty balance.

What is the discount due to the faulty balance? She gives away 1 pound though she charges only for .9 pounds because the balance shows only .9. Hence, this is another 10% discount.

So cost price = 3 * (9/10) * (9/10) = 2.43

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Karishma

Veritas Prep GMAT Instructor

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