Scott Woodbury-Stewart

GMAT OFFICIAL GUIDE PS – A project scheduled to be carried out…

A project scheduled to be carried out…

Solution:

We know that our yearly budget must be divided into 12 EQUAL monthly allocations, so we need to divide $12,600 by 12. This will give us the amount of each monthly allocation. We have:

$12,600/12 = $1,050

Thus, $1,050 should be spent PER MONTH on the project. Therefore, after 4 months, 4 x $1,050 = $4,200 should have been spent on the project.

However, we are told that $4,580 was actually spent, so the project was over budget by:

$4,580 – $4,200 = $380

Answer: A