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A company that creates and sells tape dispensers calculates its monthly profit, in dollars, by subtracting its fixed monthly costs,...

GMAT Algebra : (Alg) Questions

Source: Official
Algebra
Linear equations in 1 variable
MEDIUM
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Notes
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A company that creates and sells tape dispensers calculates its monthly profit, in dollars, by subtracting its fixed monthly costs, in dollars, from its monthly sales revenue, in dollars. The equation \(15,000 = 2.00\mathrm{x} - 4,500\) represents this situation for a month where x tape dispensers are created and sold. Which statement is the best interpretation of \(2.00\mathrm{x}\) in this context?

A

The monthly sales revenue, in dollars, from selling \(\mathrm{x}\) tape dispensers

B

The monthly sales revenue, in dollars, from each tape dispenser sold

C

The monthly cost, in dollars, of creating each tape dispenser

D

The monthly cost, in dollars, of creating \(\mathrm{x}\) tape dispensers

Solution

1. TRANSLATE the problem information

  • Given information:
    • Equation: \(\mathrm{15,000 = 2.00x - 4,500}\)
    • \(\mathrm{x}\) = number of tape dispensers created and sold
    • Monthly profit = monthly sales revenue - fixed monthly costs
  • What this tells us: We need to match each part of the equation to the business formula

2. INFER the equation structure

  • Since \(\mathrm{profit = revenue - fixed\ costs}\), our equation must follow this pattern
  • Looking at \(\mathrm{15,000 = 2.00x - 4,500}\):
    • 15,000 represents the monthly profit
    • The subtraction structure means: [revenue] - [fixed costs] = profit
    • Therefore: \(\mathrm{2.00x}\) must be revenue, and 4,500 must be fixed costs

3. TRANSLATE what \(\mathrm{2.00x}\) represents

  • Since \(\mathrm{x}\) = number of dispensers sold
  • And \(\mathrm{2.00x}\) = total monthly sales revenue
  • This means \(\mathrm{2.00x}\) represents "the monthly sales revenue, in dollars, from selling \(\mathrm{x}\) tape dispensers"

Answer: A




Why Students Usually Falter on This Problem

Most Common Error Path:

Weak TRANSLATE reasoning: Students confuse \(\mathrm{2.00x}\) (total revenue from \(\mathrm{x}\) dispensers) with 2.00 (revenue per single dispenser)

They read \(\mathrm{2.00x}\) and focus only on the coefficient 2.00, thinking this represents the revenue from each tape dispenser sold rather than recognizing that \(\mathrm{2.00x}\) as a complete expression represents total revenue from all \(\mathrm{x}\) dispensers.

This leads them to select Choice B (The monthly sales revenue, in dollars, from each tape dispenser sold)


Second Most Common Error:

Missing conceptual knowledge: Students don't recognize the profit formula structure, so they guess about what \(\mathrm{2.00x}\) could represent in the business context

Without understanding that \(\mathrm{profit = revenue - costs}\), they might think \(\mathrm{2.00x}\) represents some kind of cost rather than revenue, leading to confusion about whether to choose cost-related options.

This leads to confusion and guessing between Choice C or Choice D


The Bottom Line:

This problem requires recognizing both the mathematical structure of linear equations AND the business context of profit calculations. Students must see that \(\mathrm{2.00x}\) is a complete expression representing total revenue, not just interpret the coefficient 2.00 in isolation.

Answer Choices Explained
A

The monthly sales revenue, in dollars, from selling \(\mathrm{x}\) tape dispensers

B

The monthly sales revenue, in dollars, from each tape dispenser sold

C

The monthly cost, in dollars, of creating each tape dispenser

D

The monthly cost, in dollars, of creating \(\mathrm{x}\) tape dispensers

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