WHY SECOND STATEMENT IS NOT SUFFICIENT

Max purchased a guitar for a total of $624, which
consisted of the price of the guitar and the sales tax.
Was the sales tax rate greater than 3 percent?
(1) The price of the guitar that Max purchased was
less than $602.
(2) The sales tax for the guitar that Max purchased
was less than $30.

 

Intermediate Asked on April 11, 2018 in Data Sufficiency.
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1 Answer(s)

Hello Shilpi,

From the question data, we understand that the total cost of the guitar ($624) = Price of the guitar + Sales tax.

Using Statement 1 alone:

If the price of the guitar is $602, then the sales tax = $22 which is more than 3% of $602 ( 3% of $602 is $18.06).

Hence we may answer with a definite ‘YES’ that the sales tax rate was more than 3%.

Therefore, answer cannot be B, C or E (which is definitely an added reason which reinforces the idea that the second statement alone is not sufficient to solve the problem.) However,

Using Statement 2 alone:

Sales Tax = $30. Now, given the sales tax, we will have to work backward and find the price of the guitar.

If the price of the guitar is $1000, then $30 is exactly 3% of $1000; if the price of the guitar is less than $1000, then the sales tax rate becomes more than 3%; and if the price of the guitar is less than $1000, the sales tax rate goes down below 3%.

So, now tell me, is the second statement sufficient to answer the question asked??

Thanks,

Arvind BT

Expert Answered on August 7, 2018.
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