What is the average salary at Company A?

(1) The average salary at Company A and Company B combined is $88,000.

(2) The average salary at Company B is $80,000.
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Lets say no of employees in company A = x, avg salary of company A = a
no of employees in company B = y, avg salary of company B = b . We need to find 'a'

(1) We are given that (x*a + y*b)/(x + y) = 88000 (we divide total salary of two companies by total no of employees)
This is definitely insufficient to find 'a'

(2) b = 80000, doesnt tell anything about 'a'. Insufficient.

Combining the two statements, we have (x*a + 80000y)/(x + y) = 88000 or x*(a-88000) = 8000*y. This is also clearly insufficient to find exact value of 'a' as multiple answers are possible. (we dont know anything about x or y).

Hence E answer

Hi

88000 is the combined average. Its not the sum of salaries. So if average salary of one company is 80000, and the combined average of the two is 88000, then the average of second company has to be more than 88000 (because then only 88000 will lie in between the salary of two companies).

Basically, if average salary of one company is A and that of other company is B, then the combined average has to lie somewhere in between A and B, no matter how skewed the number of employees in two companies (if the number of employees in company with average A is much much greater than number of employees in company with average B, still the combined average will lie between A and B, though it will be much closer to A than B in this case).