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M07-33

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M07-33  [#permalink]

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New post 16 Sep 2014, 00:36
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Difficulty:

  45% (medium)

Question Stats:

66% (01:56) correct 34% (01:37) wrong based on 121 sessions

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A shop purchased a pair of sunglasses for $120 and was selling it at a price that equaled the purchase price of the sunglasses plus a markup that was 25 percent of the selling price. After some time a shop owner decided to decrease the selling price by 20 percent. What was the shop's gross profit on this sale?

A. $0
B. $2
C. $4
D. $6
E. $8

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New post 16 Sep 2014, 00:36
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Official Solution:

A shop purchased a pair of sunglasses for $120 and was selling it at a price that equaled the purchase price of the sunglasses plus a markup that was 25 percent of the selling price. After some time a shop owner decided to decrease the selling price by 20 percent. What was the shop's gross profit on this sale?

A. $0
B. $2
C. $4
D. $6
E. $8


Let the markup be \($x\), so \(x\) must be 25% of the selling price, which would be \(120+x\): \(x=0.25(120+x)\). Solving gives \(x=40\). Hence the selling price was \(120+40=160\).

The price after the discount of 20% would be \(160*0.8=128\) and the gross profit on the sale would be: final selling price - cost of the sunglasses = \($128 - $120 = $8\).


Answer: E
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Re: M07-33  [#permalink]

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New post 22 Nov 2014, 12:03
hi bunnel,
can you pls explain how the price after discount has come . Especially how 0.8 has come ?
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Re: M07-33  [#permalink]

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New post 23 Nov 2014, 07:02
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prashd wrote:
hi bunnel,
can you pls explain how the price after discount has come . Especially how 0.8 has come ?


20% discount from selling price = price - price*0.2 = price(1 - 0.2) = 0.8*price.

Hope it's clear.

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Re M07-33  [#permalink]

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New post 05 Jan 2015, 11:01
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I think this question is poor and helpful.
*selling it at a price that equaled the purchase price of the sunglasses plus a markup that was 25 percent of the selling price.*
This means if CP is 120 then SP = 120+0.25*CP

and by this approach we get ans. 0
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Re: M07-33  [#permalink]

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New post 06 Jan 2015, 02:43
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Re: M07-33  [#permalink]

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New post 15 Jan 2015, 17:40
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sanket1991 wrote:
I think this question is poor and helpful.
*selling it at a price that equaled the purchase price of the sunglasses plus a markup that was 25 percent of the selling price.*
This means if CP is 120 then SP = 120+0.25*CP

and by this approach we get ans. 0


Actually, I feel that this question is representative of many of the trickier questions you'd find on the real GMAT ~ one that you need to pay attention to its finer details.

Questions are not posed in the most convenient ways for the test taker --- and when one is stressed and trying to "race" against the clock, it's real easy to miss out on the finer details of a question that "looks" easy.

Cost: 120
Selling Price: SP = 120 + (1/4)SP ---> NOT (1/4 Cost)... SP - (1/4) SP = 120 ... (3/4) SP = 120 ... SP = 160
New Selling Price: NSP = 160 (4/5) ... NSP = 128

Profit = NSP - Cost ----> 128 - 120 = 8

Good question.
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Re: M07-33  [#permalink]

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New post 11 Oct 2015, 08:54
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Bunuel wrote:
A shop purchased a pair of sunglasses for $120 and was selling it at a price that equaled the purchase price of the sunglasses plus a markup that was 25 percent of the selling price. After some time a shop owner decided to decrease the selling price by 20 percent. What was the shop's gross profit on this sale?

A. $0
B. $2
C. $4
D. $6
E. $8


cost price of glasses is 120$.
Let the selling price be x.
Selling price=\(120+(\frac{25}{100}*Selling price)\)
Selling price=160
this Selling price is decreased by 20%, so Selling price=\(160(1-(\frac{20}{100}))\)=128
Profit=Selling price-Cost price
=128-120
=8
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Re: M07-33  [#permalink]

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New post 02 Dec 2015, 16:05
Bunuel wrote:
A shop purchased a pair of sunglasses for $120 and was selling it at a price that equaled the purchase price of the sunglasses plus a markup that was 25 percent of the selling price. After some time a shop owner decided to decrease the selling price by 20 percent. What was the shop's gross profit on this sale?

A. $0
B. $2
C. $4
D. $6
E. $8



To certain extent - it is confusing. Because "new selling price" should have been mentioned.

I tried to solve by SP = 120 + .25 SP ; .75 SP = 120; Then, with the flow of the question I solved further by setting new SP in this equation itself - .75 * .80SP = 120; which produced incorrect result SP = 200
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Re: M07-33  [#permalink]

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New post 19 Jan 2016, 06:44
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excellent wordplay in the question will get many confused but, it is lucid.
cost price = 120
selling price (SP) = 120 + 0.25*SP --- (this equation is the catch)
Hence 0.75*SP = 120 and hence SP = 160
Final SP = 0.8*SP = 0.8*160 = 128.
Hence a profit of 8$.
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Re: M07-33  [#permalink]

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New post 17 Feb 2016, 13:58
Tricky wording. I should've known answer A was too easy!

"equaled the purchase price of the sunglasses plus a markup that was 25 percent of the selling price." Is two equations.
SellingPrice = 120 + Markup
Markup= 1/4(SellingPrice)

SellingPrice = 120+ (SellingPrice/4) = 3/4SellingPrice = 120 = SellingPrice = $160

160*(4/5) = 128

Profit = Selling - Cost

E. $8
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Re: M07-33  [#permalink]

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New post 06 Sep 2016, 12:51
I would say nice question... caught me off guard with the wording...
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Re M07-33  [#permalink]

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New post 25 Jul 2017, 19:06
I think this is a high-quality question and I agree with explanation.
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Re: M07-33  [#permalink]

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New post 08 Jul 2019, 16:38
Bunuel wrote:
Official Solution:

A shop purchased a pair of sunglasses for $120 and was selling it at a price that equaled the purchase price of the sunglasses plus a markup that was 25 percent of the selling price. After some time a shop owner decided to decrease the selling price by 20 percent. What was the shop's gross profit on this sale?

A. $0
B. $2
C. $4
D. $6
E. $8


Let the markup be \($x\), so \(x\) must be 25% of the selling price, which would be \(120+x\): \(x=0.25(120+x)\). Solving gives \(x=40\). Hence the selling price was \(120+40=160\).

The price after the discount of 20% would be \(160*0.8=128\) and the gross profit on the sale would be: final selling price - cost of the sunglasses = \($128 - $120 = $8\).


Answer: E


I did it in another way:

Cost: $120
(Price - Cost)/Price=25% ----> Price=$160

Then, $160*80%= $128 ----> Profit = $128 - $120 = $8

So E is the correct answer.
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New post 01 Aug 2019, 00:39
All the explanation in test are unclear. After giving test we analyze but facing unclear explanation.
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New post 03 Aug 2019, 22:28
I think the wording can be a bit clearer. The only thing that makes this question difficult is the way its worded.

Consider:
A shop purchased a pair of sunglasses for $120 and was selling it at the purchase price plus a markup that is equal to 25 percent of the total selling price.
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Re: M07-33   [#permalink] 03 Aug 2019, 22:28
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