percents

[april]

The total of company c’s assets in 1994 was 300 percent greater than the total in 1993, which in turn was 400 percent greater than the total in 1992. If the total of company c’s assets in 1992 was N dollars, which of the following represents the total of company c’s assets in dollars in 1994?

Choices are
7N
8N
9N
12N
20N

I tried to solve it like this
1994= 300
1993= 100
1992=25

N=25

I got 12 N as the answer

The OA is E

Can someone explain this to me? Thanks!

[RonPurewal]

you're misinterpreting the wording of the problem. specifically, you're mistaking 'x percent greater than' for 'x percent as great as'.

those two are different; since this is such a common point of confusion, you can rest assured that the gmat will include wrong answers corresponding to whichever of the two happens to be incorrect for each problem.

to wit:
'x percent greater than' signifies an increase of x percent. in other words, you take x percent of the original quantity and add it onto the original quantity.

'x percent as great as' just means x percent of the original quantity; you just find the percentage, no addition necessary.

if you still aren't 100% clear on the difference, think about the stark contrast between
70% greater than Z, which is bigger than Z (by 70 percent), and
70% as great as Z, which is smaller than Z (by 30 percent).

--

in this problem, it is by far easiest to pick a smart number for 1992, not 1994. that 1994 is mentioned first makes no difference at all; 1992 is the better choice because 1993 is given as a percent change upon 1992, and 1994 is given as a further percent change upon 1993. moreover, the variable N itself stands for 1992, giving another reason to pick a nice number for 1992. (last but not least, there's also the intuitive appeal of working forward instead of backward.) so:

1992 assets = N = 1 (no need to pick 100 here, as the percents are all multiples of 100%)
1993 assets = 1 + 400% of 1 = 5
1994 assets = 5 + 300% of 5 = 20

answer = e

[StaceyKoprince]

Hi, guys - please follow the posting guidelines. Your subject line should be the first 5 to 8 words of the problem. Thanks!

[christina.susie.wong]

I was wondering why you needed to add the preceding amount to get the value?

for 1993: why add the 1 to the 400%*1?
For 1994 why add the 5 to the 300%*5?

Why is "300% greater than the value in 1994" not just "300% * (1994 value)"? Why is it (1994 value) + 300% * (1994 value)

Thank you

[kevinmarmstrong]

If your salary is 50% greater than mine, and my salary is x, yours is x + 0.5x = 1.5x

Similarly, if your salary is k(100)% greater than mine, your salary is (k+1)x


However, if your salary is k(100)% of mine, your salary is kx

[akhp77]

Question says
assets in 1994 was 300 percent greater than the total in 1993
assets in 1993 was 400 percent greater than the total in 1992

Year Year Year
1992 : 1993 : 1994
100 : 500 : 2000
or
1 : 5 : 20
or
N : 5N : 20N

So 20N is the answer

[StaceyKoprince]

Kevin, good answer to Christina's question - thanks! Christina, let us know if you still have any questions.

akhp77, nice - it looks like you did something similar to what Ron did above!