At the end of each year, a certain credit card company pays a bonus to

Question

https://gmatclub.com/forum/download/file.php?id=50877 At the end of each year, a certain credit card company pays a bonus to each of its credit card holders based on the amount, up to $10,000, that the cardholder charged throughout the year. A 0.5 percent bonus is paid on the first $1,000 charged, a 1.0 percent bonus is paid on the next $2,000 charged and so on, as indicated in the table above. What is the maximum annual bonus, in dollars? A. $100 B. $150 C. $200 D. $250 E. $500 1444716941986417.png

adstudy · Accepted Answer

Maximum Annual bonus will be when we are charged all up to the maximum amount. Hence,

=> (0.5 % of 1000) + (1 % of 2000) + (1.5 % of 3000) + (2% of 4000)
=> 5 + 20 + 45 + 80
 => 150

IMO B

ScottTargetTestPrep · Answer

We see that a cardholder who is charged $10,000 (or more) will get the maximum annual bonus.

For the first $1,000, the cardholder earns 1000 x 0.005 = $5.

For the charges between $1,000 and $3,000, the cardholder earns 2000 x 0.01 = $20.

For charges between $3,000 and $6,000, the cardholder earns 3000 x 0.015 = $45.

Finally, for charges between $6,000 and $10,000, the cardholder earns 4000 x 0.02 = $80.

In total, a maximum bonus of 5 + 20 + 45 + 80 = $150 can be earned if the cardholder is charged $10,000 (or more).

Answer: B

KarishmaB · Answer

Break the percentages instead of amount charged for quick calculation.

0.5% is earned on the entire 10k, extra 0.5% is earned on the 9k (after 1k), another 0.5% is earned on 7k (from 3k to 10k) and another 0.5% is earned on last 4k.

So total bonus = 0.5% of (10k + 9k + 7k + 4k) = 0.5% of 30,000 = $150 
(Note that 1% of 30,000 will be 300 so 0.5% will be 150)

Answer (B)

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At the end of each year, a certain credit card company pays a bonus to

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