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# Max purchased a guitar for a total of $624,which consisted of the pric SORT BY: Tags: Show Tags Hide Tags Senior Manager Joined: 11 May 2014 Status:I don't stop when I'm Tired,I stop when I'm done Posts: 474 Own Kudos [?]: 39143 [209] Given Kudos: 220 Location: Bangladesh Concentration: Finance, Leadership GPA: 2.81 WE:Business Development (Real Estate) Most Helpful Reply GMAT Club Legend Joined: 12 Sep 2015 Posts: 6814 Own Kudos [?]: 30534 [77] Given Kudos: 799 Location: Canada Retired Moderator Joined: 22 Aug 2013 Posts: 1183 Own Kudos [?]: 2524 [27] Given Kudos: 459 Location: India General Discussion Manager Joined: 05 Nov 2014 Posts: 79 Own Kudos [?]: 83 [9] Given Kudos: 113 Location: India Concentration: Strategy, Operations GMAT 1: 580 Q49 V21 GPA: 3.75 Re: Max purchased a guitar for a total of$624,which consisted of the pric [#permalink]
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Max purchased a guitar for a total of $624,which consisted of the price of the guitar and the sales tax.Was the sales tax rate greater than 3 percent ? (1) The price of the guitar that Max purchased was less than$602.

(2) The sales tax for the guitar that Max purchased was less than $30. Solution: Tricky one. Be aware of the trap. Statement 1: First calculate what's 3% of 624. It is 3x6.24=18.72. The difference between C.P of guitar and Cost paid is 624-602=22. Therefore it is clear that the sales tax rate is greater than 3%. Statement 2: We don't know the exact value of the sales tax. Though it is lesser than 30, it can be lesser,equal or greater than 3%(18.72). Insufficient. Therefore, the answer is Option A. Director Joined: 04 Dec 2015 Posts: 620 Own Kudos [?]: 1600 [10] Given Kudos: 276 Location: India Concentration: Technology, Strategy WE:Information Technology (Consulting) Re: Max purchased a guitar for a total of$624,which consisted of the pric [#permalink]
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AbdurRakib wrote:
Max purchased a guitar for a total of $624,which consisted of the price of the guitar and the sales tax.Was the sales tax rate greater than 3 percent ? (1) The price of the guitar that Max purchased was less than$602.

(2) The sales tax for the guitar that Max purchased was less than $30. (1) The price of the guitar that Max purchased was less than$602.

Maximum price of guitar can be 601. therefore sales tax price would be $$624 - 601 = 23$$

Minimum sales tax percent $$= \frac{23}{624}*100 = 3.6$$%.

Any reduction in the price of guitar will increase the sales tax price, ie; numerator will increase and hence the sales tax percent will also increase.

Therefore sales tax rate is greater than 3%. ------ I is Sufficient.

(2) The sales tax for the guitar that Max purchased was less than $30. Maximum sales price would be$29 (less than $30). Therefore Sales price rate $$= \frac{29}{624} * 100 = 4.6$$% or If sales price is$1. Sales price rate $$= \frac{1}{624} * 100 = 0.16$$%

(2) gives multiple values of sales price rate. II is Not Sufficient.

Only I alone is Sufficient. Answer (A)
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Re: Max purchased a guitar for a total of $624,which consisted of the pric [#permalink] 4 Kudos 3 Bookmarks Expert Reply AbdurRakib wrote: Max purchased a guitar for a total of$624,which consisted of the price of the guitar and the sales tax.Was the sales tax rate greater than 3 percent ?

(1) The price of the guitar that Max purchased was less than $602. (2) The sales tax for the guitar that Max purchased was less than$30.

We are given that Max purchased a guitar for a total of $624, which was the price of the guitar and the sales tax. If we let the price of the guitar = p and n = the tax rate, then we have: 624 = p + (n/100)p 624 = p(1 + n/100) 624 = p[(100 + n)/100] 62,400 = p[(100 + n) 62,400/(100 + n) = p We need to determine whether n > 3. Statement One Alone: The price of the guitar that Max purchased was less than$602.

Since p < 602 and 62,400/(100 + n) = p, we have:

62,400/(100 + n) < 602

62,400 < 60,200 + 602n

2,200 < 602n

2,200/602 ≈ 3.65 < n

Since n is greater than 3.65, the sales tax is greater than 3%.

Statement Two Alone:

The sales tax for the guitar that Max purchased was less than $30. Statement two alone is not sufficient to answer the question. For instance, if the tax was$0, then the tax rate was less than 3%; however, if the tax was $24, the price of the guitar would be$600, and the tax rate would be 24/600 = 4/100 = 4%, which is greater than 3%.

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Re: Max purchased a guitar for a total of $624,which consisted of the pric [#permalink] sashiim20 wrote: AbdurRakib wrote: Max purchased a guitar for a total of$624,which consisted of the price of the guitar and the sales tax.Was the sales tax rate greater than 3 percent ?

(1) The price of the guitar that Max purchased was less than $602. (2) The sales tax for the guitar that Max purchased was less than$30.

(1) The price of the guitar that Max purchased was less than $602. Maximum price of guitar can be 601. therefore sales tax price would be $$624 - 601 = 23$$ Minimum sales tax percent $$= \frac{23}{624}*100 = 3.6$$%. Any reduction in the price of guitar will increase the sales tax price, ie; numerator will increase and hence the sales tax percent will also increase. Therefore sales tax rate is greater than 3%. ------ I is Sufficient. (2) The sales tax for the guitar that Max purchased was less than$30.

Maximum sales price would be $29 (less than$30). Therefore Sales price rate $$= \frac{29}{624} * 100 = 4.6$$%

or

If sales price is $1. Sales price rate $$= \frac{1}{624} * 100 = 0.16$$% (2) gives multiple values of sales price rate. II is Not Sufficient. Only I alone is Sufficient. Answer (A) Though Answer is A, the sale tax is calculated on the price of guitar ie. 601 or less. It cant be calculated in total. Total = Price + sale tax. Am I wrong ? Intern Joined: 12 Mar 2015 Posts: 43 Own Kudos [?]: 161 [0] Given Kudos: 210 Location: United States GMAT 1: 670 Q45 V38 GPA: 2.99 WE:Corporate Finance (Aerospace and Defense) Re: Max purchased a guitar for a total of$624,which consisted of the pric [#permalink]
amanvermagmat wrote:
If price of guitar is P, and sales tax on it is S. Total price including sales tax = P + S = $624. We have to answer whether S > 3% of P or whether S > 0.03P Statement 1. Lets say if P =$602, then with 3% sales tax, total price = 602 + 0.03*602 = 618.06, which is < 624
So that means even at price of 602, we need to apply sales tax of greater than 3% so as to reach the required amount of 624.
Thus when the price is less than 602, definitely for every such case sales tax would need to be higher than 3% to reach the required amount of 624. Thus sufficient.

Statement 2. Sales tax is < $30. Sales tax could be$4, thus P = $620, here tax is < 3% But sales tax could be$24, thus P = $600, here tax is > 3% Clearly the statement is not sufficient. Hence A answer I have no idea why I didn't attempt the problem this way. Thank you and +1 kudos! Manager Joined: 28 Jun 2018 Posts: 96 Own Kudos [?]: 221 [1] Given Kudos: 329 Location: Bouvet Island GMAT 1: 670 Q50 V31 GMAT 2: 640 Q47 V30 GMAT 3: 700 Q49 V36 GMAT 4: 490 Q39 V18 GPA: 4 Max purchased a guitar for a total of$624,which consisted of the pric [#permalink]
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sashiim20 wrote:
AbdurRakib wrote:
Max purchased a guitar for a total of $624,which consisted of the price of the guitar and the sales tax.Was the sales tax rate greater than 3 percent ? (1) The price of the guitar that Max purchased was less than$602.

(2) The sales tax for the guitar that Max purchased was less than $30. (1) The price of the guitar that Max purchased was less than$602.

Maximum price of guitar can be 601. therefore sales tax price would be $$624 - 601 = 23$$

Minimum sales tax percent $$= \frac{23}{624}*100 = 3.6$$%.

Any reduction in the price of guitar will increase the sales tax price, ie; numerator will increase and hence the sales tax percent will also increase.

Therefore sales tax rate is greater than 3%. ------ I is Sufficient.

(2) The sales tax for the guitar that Max purchased was less than $30. Maximum sales price would be$29 (less than $30). Therefore Sales price rate $$= \frac{29}{624} * 100 = 4.6$$% or If sales price is$1. Sales price rate $$= \frac{1}{624} * 100 = 0.16$$%

(2) gives multiple values of sales price rate. II is Not Sufficient.

Only I alone is Sufficient. Answer (A)

U are calculating the sales tax percent on 642. It has to be calculated on the PRICE BEFORE THE SALEX TAX was applied.
Example - In ur statement one.. It should be Minimum sales tax percent = 23/601 * 100
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Re: Max purchased a guitar for a total of $624,which consisted of the pric [#permalink] @amanvermaggmat Thank you so much! I loved the way you explained it! Tutor Joined: 16 Oct 2010 Posts: 14950 Own Kudos [?]: 65900 [9] Given Kudos: 433 Location: Pune, India Re: Max purchased a guitar for a total of$624,which consisted of the pric [#permalink]
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AbdurRakib wrote:
Max purchased a guitar for a total of $624,which consisted of the price of the guitar and the sales tax.Was the sales tax rate greater than 3 percent ? (1) The price of the guitar that Max purchased was less than$602.

(2) The sales tax for the guitar that Max purchased was less than $30. Responding to a pm: Total = 624 = Guitar Price + Sales Tax (1) The price of the guitar that Max purchased was less than$602.

Let's say the price of the guitar is actually 602 which means tax is $22. 1% of 602 is 6.02 so 3% is$18.06.
In this case, the tax is already more than 3%.

If the price of the guitar is lower than 602, the tax will always be more than 3%.
Sufficient.

(2) The sales tax for the guitar that Max purchased was less than $30. Let's say the sales tax was exactly$30. In that case, the price of guitar is $594 1% of 594 is 5.94 so 3% is about$18.
But the tax is $30 which is much more than 3%. The tax is lower than$30. Say, it is $10. In that case, cost of guitar is$614 and the tax is less than 3%.

So here, the tax may be more than 3% or less than 3%.
Not sufficient.

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Re: Max purchased a guitar for a total of $624,which consisted of the pric [#permalink] 1 Kudos GMATPrepNow wrote: AbdurRakib wrote: Max purchased a guitar for a total of$624,which consisted of the price of the guitar and the sales tax.Was the sales tax rate greater than 3 percent ?

(1) The price of the guitar that Max purchased was less than $602. (2) The sales tax for the guitar that Max purchased was less than$30.

Target question: Was the sales tax rate greater than 3 percent?

Given: Max purchased a guitar for a total of $624, which consisted of the price of the guitar and the sales tax. Statement 1: The price of the guitar that Max purchased was less than$602.
Let's see what would happen if the sales tax were EXACTLY 3%
1% of $602 =$6.02
So, 3% of $602 ≈$18
So with a sales tax of EXACTLY 3%, the tax would be $18 This means the TOTAL price would equal$602 + $18 =$620
However, we're told that Max paid $624. Therefore, the tax rate must be GREATER than 3% NOTE: we're actually told that the price of the guitar was less than$602. This doesn't matter. If the price of the guitar is less than $602, then getting the TOTAL cost to$624, would require an even greater sales tax.
So, we can be certain that the tax rate is GREATER than 3%
Since we can answer the target question with certainty, statement 1 is SUFFICIENT

Statement 2: The sales tax for the guitar that Max purchased was less than $30. Let's test some possible cases. Case a: the sales tax is$24. This means the pre-tax price = $624 -$24 = $600. We know that 1% of$600 is $6, which means 3% of$600 is $18. Since the actual sales tax (in this scenario) is$29, we can conclude that the tax rate is GREATER than 3%
Case b: the sales tax is $4. This means the pre-tax price =$624 - $4 =$620. We know that 1% of $620 is$6.20, which means 3% of $620 is$18.60. Since the actual sales tax (in this scenario) is $4, we can conclude that the tax rate is LESS than 3% Since we cannot answer the target question with certainty, statement 2 is NOT SUFFICIENT Answer: A Cheers, Brent GMATPrepNow Hi Brent, The$29 seems like a typo in the highlighted part to me. Should it not be be $24? Let us know if that is the case. Warm Regards, Pritishd GMAT Club Legend Joined: 12 Sep 2015 Posts: 6814 Own Kudos [?]: 30534 [0] Given Kudos: 799 Location: Canada Re: Max purchased a guitar for a total of$624,which consisted of the pric [#permalink]
Top Contributor
Pritishd wrote:

GMATPrepNow

Hi Brent,

The $29 seems like a typo in the highlighted part to me. Should it not be be$24? Let us know if that is the case.

Warm Regards,
Pritishd

Good catch. That was, indeed, a typo.
I have corrected the error.
Thanks!

Kudos for you!!!

Cheers,
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Re: Max purchased a guitar for a total of $624,which consisted of the pric [#permalink] Top Contributor AbdurRakib wrote: Max purchased a guitar for a total of$624,which consisted of the price of the guitar and the sales tax.Was the sales tax rate greater than 3 percent ?

(1) The price of the guitar that Max purchased was less than $602. (2) The sales tax for the guitar that Max purchased was less than$30.

1) let price 601 (less than 602), so tax will be = 23
Rate = [23/601]*100
(23/6.01)= 3x+5.01 Sufficient.

2) if tax is 24 then [(24/600)*100 = 4 yes, but if tax is 20 then (17/600)*100: No.

Ans. A.
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Max purchased a guitar for a total of $624,which consisted of the pric [#permalink] 624=P+T is T>3% ? -> is T > 624*3% ~ 18 -> is P< 624-18=606 (1) P< 602 < 606 -> sufficient (2) T< 30 -> T = 19 (Sufficient) or T =17 (insufficient) -> choose A VP Joined: 11 Aug 2020 Posts: 1255 Own Kudos [?]: 204 [0] Given Kudos: 332 Re: Max purchased a guitar for a total of$624,which consisted of the pric [#permalink]
Would this be the right way of approaching it?

Max purchased a guitar for a total of $624,which consisted of the price of the guitar and the sales tax.Was the sales tax rate greater than 3 percent ? (1) The price of the guitar that Max purchased was less than$602.

Assume price = 600

624 = 600 + 6t
t = 4

In fact, the smaller the price of the guitar, the larger the tax rate is.

Sufficient.

(2) The sales tax for the guitar that Max purchased was less than $30. tp/100 < 30 p = 299, t = 1 NO p = 75, t = 4 YES Insufficient. GMAT Club Legend Joined: 08 Jul 2010 Status:GMAT/GRE Tutor l Admission Consultant l On-Demand Course creator Posts: 6012 Own Kudos [?]: 13613 [1] Given Kudos: 124 Location: India GMAT: QUANT+DI EXPERT Schools: IIM (A) ISB '24 GMAT 1: 750 Q51 V41 WE:Education (Education) Re: Max purchased a guitar for a total of$624,which consisted of the pric [#permalink]
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AbdurRakib wrote:
Max purchased a guitar for a total of $624,which consisted of the price of the guitar and the sales tax.Was the sales tax rate greater than 3 percent ? (1) The price of the guitar that Max purchased was less than$602.

(2) The sales tax for the guitar that Max purchased was less than $30. Solve the Official Questions more productively Click here and solve 1000+ Official Questions with Video solutions as Timed Sectional Tests and Dedicated Data Sufficiency (DS) Course Answer: Option A Video solution by GMATinsight Get TOPICWISE: Concept Videos | Practice Qns 100+ | Official Qns 50+ | 100% Video solution CLICK HERE. Two MUST join YouTube channels : GMATinsight (1000+ FREE Videos) and GMATclub Tutor Joined: 17 Jul 2019 Posts: 1304 Own Kudos [?]: 2137 [2] Given Kudos: 66 Location: Canada GMAT 1: 780 Q51 V45 GMAT 2: 780 Q50 V47 GMAT 3: 770 Q50 V45 Re: Max purchased a guitar for a total of$624,which consisted of the pric [#permalink]
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Re: Max purchased a guitar for a total of $624,which consisted of the pric [#permalink] Hello from the GMAT Club BumpBot! Thanks to another GMAT Club member, I have just discovered this valuable topic, yet it had no discussion for over a year. I am now bumping it up - doing my job. I think you may find it valuable (esp those replies with Kudos). Want to see all other topics I dig out? Follow me (click follow button on profile). You will receive a summary of all topics I bump in your profile area as well as via email. Re: Max purchased a guitar for a total of$624,which consisted of the pric [#permalink]