A home-goods store sold several identical floor lamps in a clearance

Question

A home-goods store sold several identical floor lamps in a clearance sale. Each lamp had the same original marked price and was sold at the same percentage discount from that price. If the store had paid 157 euros for each lamp, did the store make a profit on the sale of each lamp?

(1) The discount on each lamp was less than 30%.
(2) The original marked price of each lamp was greater than 220 euros.

Bunuel · Accepted Answer

GMAT Club Official Solution:

A home-goods store sold several identical floor lamps in a clearance sale. Each lamp had the same original marked price and was sold at the same percentage discount from that price. If the store had paid 157 euros for each lamp, did the store make a profit on the sale of each lamp?

(1) The discount on each lamp was less than 30%.

This tells us only that each lamp was sold for more than 70% of its original marked price. But we do not know the original marked price, so we cannot determine whether the selling price was greater than 157 euros. Not sufficient.

(2) The original marked price of each lamp was greater than 220 euros.

This tells us only the original marked price. But we do not know the discount, so we cannot determine the selling price. Not sufficient.

(1) + (2) Together, the statements tell us that the selling price of each lamp was greater than 70% of 220 euros, so greater than 0.7 * 220 = 154 euros. But the store paid 157 euros for each lamp, so this still does not determine whether there was a profit.

For example, if the original marked price was 221 euros and the discount was 29%, then the selling price was 221 * 0.71 = 156.91 euros, so there was no profit.

But if the original marked price was 240 euros and the discount was 20%, then the selling price was 192 euros, so there was a profit.

So even together, the statements are not sufficient.

Answer: E.

Adit_ · Answer

Statement 1: We only know the discount and not the MP. INSUFFICIENT. Statement 2: We only know the MP and not discount. INSUFFICIENT. Combining the two: Take critical values: 220*0.7 = 154. Now MP>220 and Discount < 30% Which means from the critical value we know that SP > 154 But CP = 157 for each and we can definitely have SP < CP or SP>CP. INSUFFICIENT. Answer: Option E

thisisakr · Answer

We are given cost price of lamp =157

And that it was sold at some discounted price

Statement 1: says discount % was less than 30 but doesn’t specify how much or what the selling price was so we can’t calculate anything —-  insufficient

Statement 2: it says MRP is more than 220 but again doesn’t mentions what is the discount offered so we can’t be sure if it was in profit or loss —-  insufficient

Together 
Now we know CP= 157 , MRP >220, D% <30
 Values are still variable but let’s check the limit 
Say MRP was 221 and discount was 29% then 
Selling Price = 221*0.71=156.91. This is less than CP 157 hence a loss
However let’s say MRP= 221 but discount was 10% 
Now , SP = 221*.90=198.9 here there is a profit of 198.9-157=41.9

So we have no conclusive answer ——  insufficient 
Answer E

A home-goods store sold several identical floor lamps in a clearance

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A home-goods store sold several identical floor lamps in a clearance

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