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If a merchant purchased a sofa from a manufacturer for $400 and then sold it, what was the selling price of the sofa? – OG 2020 Question #381 with Solution

OG 2020: Question No. 381

If a merchant purchased a sofa from a manufacturer for $400 and then sold it, what was the selling price of the sofa?

  1. The selling price of the sofa was greater than 140 percent of the purchase price.
  2. The merchant’s gross profit from the purchase and sale of the sofa was 1/3 of the selling price.
SourceOG 2020
TypeData Sufficiency
TopicWord Problems
Sub-TopicSales & Purchase
DifficultyEasy – Medium

Solution

Steps 1 & 2: Understand Question and Draw Inferences

In this question, we are given

  • A merchant purchased a sofa from a manufacturer for $400 and then sold it.

We need to determine

  • The selling price of the sofa.

As we have no other relevant information present in the question stem, let us now analyse the individual statements.

Step 3: Analyse Statement 1

As per the information given in statement 1, the selling price of the sofa was greater than 140 percent of the purchase price.

  • However, to determine the exact selling price, we need to know by what exact percentage the selling price is greater than purchase price.

Since we don’t know the exact percentage value, statement 1 is not sufficient to answer the question.

Step 4: Analyse Statement 2

As per the information given in statement 2, the merchant’s gross profit from the purchase and sale of the sofa was 1/3 of the selling price.

  • Profit = selling price – purchase price

Or, 1/3 * selling price = selling price – purchase price

Or, 2/3 * selling price = purchase price = 400

Or, selling price = 400 * 3/2 = 600

Hence, statement 2 is sufficient to answer the question.

Step 5: Combine Both Statements Together (If Needed)

Since we can determine the answer from statement 2 individually, this step is not required.

Hence, the correct answer choice is option B.

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