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Next year, a certain executive will receive a 15-percent

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Director
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Next year, a certain executive will receive a 15-percent [#permalink]

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06 Sep 2004, 21:49
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Next year, a certain executive will receive a 15-percent increase in base salary, but will no longer receive her $8000 yearly bonus. If next year's salary represents a 7-percent net increase in income from this year, what is this year's base salary? A) 100,000 B) 105,000 C) 107,000 D) 115,000 E) 123,050 Please explain your answers. Director Joined: 16 Jun 2004 Posts: 892 Followers: 3 Kudos [?]: 63 [0], given: 0 Show Tags 06 Sep 2004, 22:12 Six figure salaries are interesting, so this question interests me. (115/100)X - 8000 = (107/100)X X=100,000 Manager Joined: 31 Dec 2003 Posts: 214 Location: US Followers: 0 Kudos [?]: 39 [0], given: 0 Show Tags 06 Sep 2004, 23:14 Let this years base salary be x. then 1.07 (x + 8000 ) = 1.15x x= 107000,hence C. Manager Joined: 28 Jul 2004 Posts: 54 Followers: 1 Kudos [?]: 1 [0], given: 0 Show Tags 07 Sep 2004, 00:10 answer is 100000 anuram check ur answer... the increase comes to 7.52 % in ur case.. _________________ Jim Director Joined: 16 Jun 2004 Posts: 892 Followers: 3 Kudos [?]: 63 [0], given: 0 Show Tags 07 Sep 2004, 01:44 Let me start over again. let the base salary be X this year. The net income this year = X+8000 (missed net income) Next year the salary will be = 1.15 X 1.15X = 1.07(X+8000) =>0.08X=8560 =>X= 8560/0.08 = 107000. Anuramm, you are right. GMAT Club Legend Joined: 07 Jul 2004 Posts: 5045 Location: Singapore Followers: 31 Kudos [?]: 376 [0], given: 0 Show Tags 07 Sep 2004, 01:51 This year's base salary = n Bonus = 8000 So total salary = n+8000 Next year, base salary = 1.15n Bonus = 0 Total salary = 1.15n (1.15n - n - 8000)/n * 100% = 7% (0.15n-8000) = 0.07n 0.08n = 8000 n = 100,000 (A) is the answer Manager Joined: 31 Aug 2004 Posts: 162 Location: Vancouver, BC, Canada Followers: 1 Kudos [?]: 12 [0], given: 0 Show Tags 07 Sep 2004, 12:43 My answer is 107000 as well, but after I saw the solutions from ywilfred and jimishg, I have a question for you guys: What is your definition of income? Do you agree or disagree the following Income = Base salary + Bonus If bonus does not account for your income, then how do we call it? This is where we can two different answers. For people who get 107000, we treat bonus as a portion of income; for people who get 100000, they think bonus is not a part of income. We need OA, pls! Last edited by jinino on 07 Sep 2004, 20:36, edited 1 time in total. Manager Joined: 05 Sep 2004 Posts: 97 Followers: 1 Kudos [?]: 3 [0], given: 0 Re: PS: Salary Increase [#permalink] Show Tags 07 Sep 2004, 13:08 hardworker_indian wrote: If next year's salary represents a 7-percent net increase in income from this year What do you mean by this sentence? The way I read it is: Next year's salary = 1.15 * current salary = Net increase in income = 7% = Next year's salary - current salary ? .... which is over the top. Could you please clarify? Manager Joined: 02 Apr 2004 Posts: 222 Location: Utrecht Followers: 1 Kudos [?]: 21 [0], given: 0 Show Tags 07 Sep 2004, 13:14 I would choose A. The reason is that in the question it is mentioned that the person in the second year will not get his or her yearly bonus of$ 8000. Therefore I believe the bonus will not be part of the income as I assume the bonus is yearly fixed on $8000. Please correct me if I am wrong. Regards, Alex Director Joined: 31 Aug 2004 Posts: 607 Followers: 3 Kudos [?]: 132 [0], given: 0 Show Tags 07 Sep 2004, 15:40 Today : F+V F? Next year : F'+V' F'= 1,15F V'=0 V=8000 (F'+V')=1,07(F+V) 0,08F=1,07*8000=> F= 107000 Director Joined: 05 May 2004 Posts: 575 Location: San Jose, CA Followers: 2 Kudos [?]: 61 [0], given: 0 Show Tags 07 Sep 2004, 16:01 Got 107K .07(S+8000)=1.15S-(S+8000) ... solve S Director Joined: 20 Jul 2004 Posts: 592 Followers: 2 Kudos [?]: 138 [0], given: 0 Show Tags 07 Sep 2004, 16:45 venksune wrote: Six figure salaries are interesting, so this question interests me. (115/100)X - 8000 = (107/100)X X=100,000 I too did like this and got it wrong. The mistake in this is that we are subtracting the non-existant boonus from next years salary, whereas it should be added with current year's salary to make it an "income". OA is (C) 107,000. Anuramm's method is simple and correct. anuramm wrote: Let this years base salary be x. then 1.07 (x + 8000 ) = 1.15x x= 107000,hence C. jinino wrote: What is your definition of income? Do you agree or disagree the following: Income = Base salary + Bonus Yes, this is correct. Director Joined: 16 Jun 2004 Posts: 892 Followers: 3 Kudos [?]: 63 [0], given: 0 Show Tags 07 Sep 2004, 19:28 Yes, realised the mistake and corrected it in one of my earlier posts. good one. Manager Joined: 21 Aug 2004 Posts: 135 Followers: 1 Kudos [?]: 31 [0], given: 0 Show Tags 08 Sep 2004, 00:26 Next year, a certain executive will receive a 15-percent increase in base salary, but will no longer receive her$8000 yearly bonus. If next year's salary represents a 7-percent net increase in income from this year, what is this year's base salary?

Let this years base salary = x
Total income this year = x + 8000
Total income next year = 1.15x

now 1.15x = 1.07(x + 8000)
X = 107,000
Manager
Joined: 18 Jun 2004
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Location: san jose , CA
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08 Sep 2004, 03:07
i used the following equation

1.15x = 1.07(x+8000)

x = 107,000
_________________

---- Hero never chooses Destiny
Destiny chooses Him ......

08 Sep 2004, 03:07
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Next year, a certain executive will receive a 15-percent

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