Source: Official Guide for the GMAT 13th Ed. Problem Solving; #57 Official Guide for the GMAT 2015 14th Ed. Problem Solving; #57

1

Company P had 15 percent more employees

Company P had 15 percent more employees in December than it had in January. If Company P had 460 employees in December, how many employees did it have in January?

4 Explanations

2

bilal muzaffar

how about 460 , 10 % = 46 and 5 % =23, and 460 - 46-23 = 391

Aug 31, 2016 • Comment

Sam Kinsman, Magoosh Tutor

Be careful, Bilal! Keep in mind that if you go up by a percent and down by the same percent, you won’t end up in the same place.!

Let's call the employees the company had in January X. The question tells us that X * 1.15 = 460. This is the equation that we need to use to solve this problem. However, you tried using 460 * .85 = X. These two equations will NOT give you the same result!

This is a common mistake that students make on the GMAT. In fact, this mistake is so common that has it's own name: it's called "the percent change trap." I'd suggest that you check out the following video to learn more about the percent change trap and how to avoid it:

http://magoosh.com/gmat/2014/gmat-tuesdays-with-kevin-percent-change-trap/

Sep 2, 2016 • Reply

2

Gravatar Jonathan , Magoosh Tutor

460 = X + 15%(of X) = 1.15X is NOT the same as saying X is 85% of 460.

Remember the formula for percent change is:

[change]/[starting amount/number]

When we say 460 = 1.15 (400), the 15% is calculated off the 400. That's our starting number.

When we say .85(460), the -15% is calculate off the 460. 460 is our starting number in this case.

And of course, 15% of 400 is not the same as 15% of 460.

Take any number N and increase it by 15%, then decrease that result by 15%. You will get:

N * 1.15 * .85 = something slightly less than N, NOT N.

So 15% increase does not undo a 15% decrease and vice-versa because the starting amount changes after the increase.. This is a typical "trap."

"A is B increased by 15%" --> A = 1.15B

"B is 15% less than A" --> .85A = B

Hope that helps.

Apr 28, 2015 • Comment

1

Jan ---------------------> Dec
100 ---------------------> 115
x ------------------------> 460

Since 460 is 4 times 115,
x has to be 4 times 100.

So, correct asnwer is 400 (B).

Jan 25, 2015 • Comment

3

Gravatar Mike McGarry, Magoosh Tutor

Dec 27, 2013 • Comment

Luis Barrientos

Why is not possible to do: 460 employees in December is X, - 15% = .85X = 391 ?
Thanks.

Apr 18, 2015 • Reply

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