Last Updated on May 9, 2023
GMAT OFFICIAL GUIDE DS
Solution:
We are given that a clothing store acquired an item at a cost of x dollars and sold the item for y dollars. We must determine:
(profit/cost) * 100 = ?
We are given x as the cost and y as the revenue. Thus, profit = revenue – cost = y – x, and thus we can substitute y – x for profit and x for cost. Thus, our new question is:
(y – x)/x * 100 = ?
Statement One Alone:
y – x = 20
Since y – x = 20, we can substitute 20 for y – x into the expression (y – x)/x * 100.
The new question is: 20/x * 100 = ?
Since we do not know the value of x, statement one alone is not sufficient. We can eliminate answer choices A and D.
Statement Two Alone:
y/x = 5/4
When we cross multiply y/x = 5/4 we obtain:
4y = 5x
(4/5)y = x
0.8y = x
Since 0.8y = x, we can substitute 0.8y for x in the expression (y – x)/x * 100.
(y – 0.8y)/(0.8y) * 100 = ?
(0.2y)/(0.8y) * 100 = ?
(0.2/0.8) * 100 = ?
(1/4) * 100 = 25%
Statement two is sufficient.
Answer: B
