Events & Promotions
|
|
GMAT Club Daily Prep
Thank you for using the timer - this advanced tool can estimate your performance and suggest more practice questions. We have subscribed you to Daily Prep Questions via email.
Customized
for You
Track
Your Progress
Practice
Pays
Not interested in getting valuable practice questions and articles delivered to your email? No problem, unsubscribe here.
Sep 2107:00 PM EDT
-10:00 PM EDT
Boost your GMAT score in less than one month in a live online class + 6 months access to TTP OnDemand video courses included!
Sep 2312:30 AM EDT
-01:30 AM EDT
Learn how Keshav, a Chartered Accountant, scored an impressive 705 on GMAT in just 30 days with GMATWhiz's expert guidance. In this video, he shares preparation tips and strategies that worked for him, including the mock, time management, and more
Sep 2401:30 AM EDT
-01:30 AM EDT
Tejas studied hard but kept repeating the same mistakes. After 3 attempts at 645, a focused 4-week strategy helped him identify and fix what was holding him back—leading to a 695 with just 12–15 hours of study per week.
Sep 2606:00 PM PDT
-07:00 PM PDT
Free- full-length test + 15 concept videos + 150+ short videos + study plan!
22 Feb 2018, 20:43
Kudos
Bookmarks
E
Be sure to select an answer first to save it in the Error Log before revealing the correct answer (OA)!
Difficulty:
25%
(medium)
Question Stats:
78% (01:52) correct
22%
(02:17)
wrong
based on 87
sessions
History
Date
Time
Result
Not Attempted Yet
A magazine costs $1.00 per copy to produce. If $20,000 was taken in for advertising in the magazine, how many copies at 75 cents per copy must be sold to make a profit of exactly $10,000?
(A) 10,000
(B) 20,000
(C) 25,000
(D) 35,000
(E) 40,000
(A) 10,000
(B) 20,000
(C) 25,000
(D) 35,000
(E) 40,000
22 Feb 2018, 21:58
Kudos
Bookmarks
Bunuel
Since the cost of producing 1 magazine is $1, to produce x magazine, we would need $x.
Part of this cost was recovered by advertising in the magazine, which was $20000
We need to make a profit of $10000, selling at $0.75 per magazine.
\((0.75x + $20000) - x = $10000\) -> \(0.25x = $10000\) -> \(x = 40000\)
Therefore, we would need to produce 40000 magazines to realize a profit of $10000(Option E)
24 Feb 2018, 13:18
Kudos
Bookmarks
Bunuel
I think pushpitkc 's solution might be better, but if you can't "see" the equation, work backwards. The magazine has collected $20,000 for advertising. Call that "cost offset."
Start with C) 25,000 copies
Cost to produce: (25,000 * $1) = $25,000
Cost offset: -$20,000
TOTAL COST: ($25,000 - $20,000) = $5,000
TOTAL REVENUE: (25,000 * $0.75) = $18,750
PROFIT =(TR-TC) = ($18,750 - $5,000) = $13,750
Too high. We have too FEW copies.
Why? Cost to produce ($1) is higher than sell price ($0.75). (The $20K offset makes this possible.)
To decrease profit (from $13,750 to $10,000), we must increase costs.
That can be done only by producing more copies. Eliminate A and B.
Try Answer E because it is "rounder" than D.
40,000 copies?
Cost to produce: (40,000 * $1) = $40,000
Cost offset: $20,000
TOTAL COST:($40,000 - $20,000) = $20,000
TOTAL REVENUE: (40,000 * $0.75) = $30,000
PROFIT =(TR-TC) = ($30,000 - $20,000) = $10,000
That's a match.
Answer E
