Old question (originally posted by FN) for new clubbers

Question

1. A customer using a certain phone call plan pays a fee of $25 a month, and then recieves a 40% discount on regular charges for all phone calls to country X. If calls to country X are regularly charged at $1.60 for the first 3 minutes and $0.80 for every additional minute thereafter. What is the maximum the customer could have saved over the regular charges, for 1 hr of calls he made to country X during a particular month.

A) 8.75
B) 12.00
C) 13.40
D) 17.40
E) 24.40

A) 8.75
B) 12.00
C) 13.40
D) 17.40
E) 24.40

tkarthi4u · Answer

Good problem.

Hope i am right.

Call Plan = 25 $
Regular chrages = 1.6 $ ( for first 3 min) + 0.8 ( each additional min )

For a call of 60 min RC 1 = 1.6 + .8 * 57 = 47.2

The customer could maximize his saving by making calls of 3 min since be only charged for 1.6. So for 60 min he can make 2o calls

For a call of 60 min RC 2 = 1.6 * 20 = 32

Saving S1 = 47.2 - 32 = 15 . 2

Inspite of this he hets a 40 % discount

RC1 = 47.2 * .6 = 28.32
 RC2 = 32 * .6 = 19.2

Saving S2 = 28.32 - 19.2 = 9.12

Total Saving = S1 + S2 = 15.2 + 9.12 = 24.32

Ans .E

bigtreezl · Answer

dont understand because of incomplete sentences...typos?

xenok · Answer

I feel the right answer should be $18.88, which is not listed above. This is a very poorly worded question.
Asking for maximum savings on a 40% discount is basically asking what is the maximum charge that can be racked up, i.e. 40% of maximum charges will lead to maximum savings.

While there is nothing wrong with your math, there is an issue of classification.

Saving S1 = 47.2 - 32 = 15 . 2  <-- How is this a saving? The regular charge is $1.60 for the first three minutes. Making 20 three min calls instead of one long hour call is just exploiting the regular charge, it should not count as a savings.

The question phrases the situation as a single saving, that one can save 40% on regular charges. If the question wishes to clarify that there are two types of saving, the first ($1.60 for the first three minutes) should NOT be listed under regular charges. Paying regular charges should NOT count as savings.

I feel this is a poorly worded question.

GMAT TIGER · Answer

Do you really think so or does it really matter? Then how do you define/interpret "maximum"?

xenok · Answer

The way I've found to get a number corresponding to one of the answers given, is to use the following logic.

1. Maximum savings = 40% off maximum charges.
2. Assume $1.60/min for the first three minutes.
3. Hence, maximum charge for one hr of calls is 60X$1.60 = $96.
4. Savings from maximum charges is 40% x 96 = $38.4
5. However, you paid $25 to get this 40% discount, so overall savings $38.4 - $25 = $13.4
6. Therefore the answer is C.

Again, I still think it's a poorly worded question.

FN · Answer

I miss gmatclub math forum..gonna post some of my old questions here again..

GMAT TIGER · Answer

OA revealed earlier is C.

I think "the maximum the customer could have saved over the regular charges" provides the clue for the answer. 
When does somebody save max? When the calls last 1 minuets (each 60 calls) or 3 minuets (each 20 calls).

Thanks all.

Old question (originally posted by FN) for new clubbers

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