A used car dealer sold one car at a profit of 25 percent of the dealers purchase price for that car and sold another car at a loss of 20 percent of the dealers purchase price for that car. If the dealer sold each car for $20,000, what was the dealers total profit or loss, in dollars, for the two transactions combined?

A used car dealer sold one car at a profit of 25 percent of the dealers purchase price for that car and sold another car at a loss of 20 percent of the dealers purchase price for that car. If the dealer sold each car for $20,000, what was the dealers total profit or loss, in dollars, for the two transactions combined?

(A) $1,000 profit
(B) $2,000 profit
(C) $1,000 loss
(D) $2,000 loss
(E) $3334 loss

Define the question: what was the dealers total profit or loss, in dollars, for the two transactions combined?

We’re given the selling price of the cars and the profit/loss %. With that we can solve for the cost of each car and from there figure out the dollar amount of profit or loss. Last step is to get the difference.

Car 1

5/4*Cost = 20,000

Cost = 16,000

Profit = 4,000

Car 2

4/5*Cost = 20,000

Cost = 25,0000

Loss = 5,000

4000 – 5000 = -1000

So it’s a $1000 loss. Choose C.

Learn more about GMAT tutoring with Atlantic

gmat tutoring consultations

 

GMAT Question of the Day Signup

Sign up for 1 challenging GMAT question sent to you each week.
  • This field is for validation purposes and should be left unchanged.

Leave a Comment

Your email address will not be published.