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# Last year, a certain company began manufacturing product X

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Intern
Joined: 20 May 2012
Posts: 20
Last year, a certain company began manufacturing product X [#permalink]

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05 Jun 2012, 15:09
00:00

Difficulty:

55% (hard)

Question Stats:

61% (01:40) correct 39% (02:58) wrong based on 36 sessions

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Last year, a certain company began manufacturing product X and sold every unit of product X that it produced. Last year the company's total expenses for manufacturing product X were equal to \$100,000 plus 5% of the company's total revenue from all units of product X sold. If the company made a profit on product X last year, did the company sell more than 21000 units of product X?

(1) The company's total revenue from the sale of product X last year was greater than \$110,000
(2) For each unit of product X sold last year, the company's revenue was \$5

OPEN DISCUSSION OF THIS QUESTION IS HERE: last-year-a-certain-company-began-manufacturing-product-x-a-144141.html

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Current Student
Joined: 29 Mar 2012
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Re: Last year, a certain company began manufacturing product X [#permalink]

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05 Jun 2012, 22:09
2
Hi,

It is given that the total expense for the company = 100,000 + 5% of total revenue (let say, x)
Profit = Total revenue - expenses = x - (100000 + 0.05x) = 0.95x - 100000
Since profit > 0
therefore, 0.95x - 100000 > 0 ...(a)

using (1) The company's total revenue from the sale of product X last year was greater than \$110,000,
we can only check whether 0.95x - 100000 is positive or not. Insufficient.

using (2) For each unit of product X sold last year, the company's revenue was \$5,
lets find the minimum number of units,
number of units = total revenue/5 = x/5
or 0.95(x/5) - 100000 >0 ....(from (a))
or x > 21052, thus x is greater than 21000. Sufficient.

Regards,
Manager
Joined: 21 Jul 2017
Posts: 137
Location: India
GMAT 1: 650 Q47 V33
GPA: 4
WE: Project Management (Education)
Re: Last year, a certain company began manufacturing product X [#permalink]

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14 Sep 2017, 10:57
2
Math Expert
Joined: 02 Sep 2009
Posts: 47033
Re: Last year, a certain company began manufacturing product X [#permalink]

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14 Sep 2017, 21:59
1
Val1986 wrote:
Last year, a certain company began manufacturing product X and sold every unit of product X that it produced. Last year the company's total expenses for manufacturing product X were equal to \$100,000 plus 5% of the company's total revenue from all units of product X sold. If the company made a profit on product X last year, did the company sell more than 21000 units of product X?

(1) The company's total revenue from the sale of product X last year was greater than \$110,000
(2) For each unit of product X sold last year, the company's revenue was \$5

Last year, a certain company began manufacturing product X and sold every unit of product X that it produced. Last year the company's total expenses for manufacturing product X were equal to \$100,000 plus 5 percent of the company's total revenue from all units of product X sold. If the company made a profit on product X last year, did the company sell more than 21,000 units of product X last year?

Since the company made a profit, then R-(100,000+0.05R)>0 --> R>2,000,000/19=~105,000.

(1) The company's total revenue from the sale of product X last year was greater than \$110,000 --> R>110,000. Its possible that company sold just one unit for say \$120,000 or 120,000 units for \$1. Not sufficient.

(2) For each unit of product X sold last year, the company's revenue was \$5. If total of n units were sold, then the total revenue would be \$5n, so R=5n --> 5n>2,000,000/19 --> n>400,00/19>21,000. Sufficient.

OPEN DISCUSSION OF THIS QUESTION IS HERE: last-year-a-certain-company-began-manufacturing-product-x-a-144141.html

--== Message from GMAT Club Team ==--

This is not a quality discussion. It has been retired.

If you would like to discuss this question please re-post it in the respective forum. Thank you!

To review the GMAT Club's Forums Posting Guidelines, please follow these links: Quantitative | Verbal Please note - we may remove posts that do not follow our posting guidelines. Thank you.

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Re: Last year, a certain company began manufacturing product X   [#permalink] 14 Sep 2017, 21:59
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