Two-Part Analysis is one of types of questions that will appear on the new Integrated Reasoning section!
At a certain corporation, N is the total number of employees. These employees can choose among a variety of benefits packages, and R% of them choose the stock option plan as their benefit package. For each employee in this plan, the corporation annually buys S shares of the company’s stock. Suppose the average price per share of the company’s stock is P.
(On the real GMAT, the table below will have bubble choices for selecting answers, but here, select answers (A) – (F), as if it were ordinary multiple choice.)
|
The total number of shares of stock the corporation must buy annually to support this benefit package |
The average monetary value of a single employee’s annual benefit in this plan |
|
|
(A) |
(A) |
NPS |
|
(B) |
(B) |
NRS |
|
(C) |
(C) |
NRS/100 |
|
(D) |
(D) |
RSP |
|
(E) |
(E) |
RSP/100 |
|
(F) |
(F) |
SP |
Practice Question Answers and Explanations:
left column = (C)
right column = (F)
left column: The total number of shares of stock the corporation must buy annually to support this benefit package.
First of all, we need to figure out the number of employees in this benefit plan. That number is R% of N, but in order to express that as an algebraic expression, we need to rewrite the percent as a fraction: (R/100)*N. That’s the number of employees in the stock option plan.
Each one of those employees receives S stocks annually. If (R/100)*N employees each receive S stocks, that’s a total of (R/100)*N*S = (NRS)/100. Answer = C.
right column: The average monetary value of a single employee’s annual benefit in this plan
One employee receives S shares of stock. Each one has an average value of P, so the total one employee receives is SP. Answer = F.
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