# when leo imported a certain item, he paid a 7 percent import tax on the portion of the total value of the item in excess of $1,000. if the amount of the import tax that leo paid was $87.50, what was the total value of the item?

### Mohammed

Guys, does anyone know the answer?

get when leo imported a certain item, he paid a 7 percent import tax on the portion of the total value of the item in excess of $1,000. if the amount of the import tax that leo paid was $87.50, what was the total value of the item? from screen.

## When Leo imported a certain item, he paid a 7 percent import tax on the portion of the total value of the item in excess of 1000. If the amount of the import tax that Leo paid was 87.50, what was the total value of the item ?

Click here👆to get an answer to your question ✍️ When Leo imported a certain item, he paid a 7 percent import tax on the portion of the total value of the item in excess of 1000. If the amount of the import tax that Leo paid was 87.50, what was the total value of the item ?

Question

## When Leo imported a certain item, he paid a 7 percent import tax on the portion of the total value of the item in excess of $1000. If the amount of the import tax that Leo paid was $87.50, what was the total value of the item ?

**A**

## $ 1600

**B**

## $ 1850

**C**

## $ 2250

**D**

## $ 2400

**E**

## $ 2750

Easy Open in App Solution Verified by Toppr

Correct option is C)

As given in the problem,Tax paid by Leo = 7% of Excess Amount which is given to be $87.50

Thus, 100 7 ×x=87.50 Therefore, x=1250

This amount must be in excess of $1000

So, the total value of the item must be $1000+$1250=$2250

(option C)

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## When Leo imported a certain item, he

Source: Official Guide for the GMAT 13th Ed. Problem Solving; #11 Official Guide for the GMAT 2015 14th Ed. Problem Solving; #11

▲ 5

## When Leo imported a certain item, he

### 3 Explanations

▲ 3 Mohammad Aasim

I have read the response to the query of Rachel L Little. But still i don't get to digest the logic behind the provided explanation. I know that it is straight forward but still appears to be a little twisted.

I fail to grasp the point that how the 7% tax turns out to be the part of the amount over and above the $10000?

Aug 10, 2017 • Comment

Jonathan , Magoosh Tutor

Hi Mohammad,

The question tells us that 7% is the tax on the part over 1,000:

"When Leo imported a certain item, he paid a 7 percent import tax on the portion of the total value of the item in excess of $1,000."

So, he pays 7% of the value that is in excess of 1,000.

7% of that excess is 87.50. Let "x" be the excess.

.07x = 87.50 So x = 1,250.

1,250 is the value over 1,000. So the total value is 1,000 + 1,250.

Sep 4, 2017 • Reply ▲ 2 Shakib Huq Hi all,

The algebraic solution is quite simple as well which is as follows:

Let Total Value be X

7/100(X-1000)=87.5 7(X-1000)=8750 X-1000=1250

X=2250 which is Answer Choice (C)

Cheers!

Feb 20, 2016 • Comment

▲ 3

Mike McGarry, Magoosh Tutor

Dec 26, 2013 • Comment

Phil McDonald

How did you quickly figure out 12.50 was 1% of the unknown? I resorted to long division which I know I need to avoid..

Nov 20, 2014 • Reply

Jonathan , Magoosh Tutor

Hi Phil!

Good question! Actually, long division IS what you would do there. But it's pretty quick "long" division, since you're only dividing by a single-digit number. You're right that the GMAT wouldn't require lengthy, time-consuming calculations, but this kind of long division could be necessary. I hope that helps :)

Nov 26, 2014 • Reply

Rachel L Little

I'm a little confused as to the reasoning behind finding the answer. Math is not my strong point, so please bear with me - but why did you choose/know that 100% would be the excess above the $1000 tax free portion? In other words, how did you know that 100% would give you the amount that was taxed 7% ?

Mar 31, 2016 • Reply

Cydney Seigerman, Magoosh Tutor

Hi Rachel :)

Happy to help! The tax only applies to the part of the cost of the item above $1000. In other words, the first $1000 of the cost is not taxed, while the amount after $1000 is taxed. This means that the 7% tax (= $87.50) is 7% of the part of the price that was taxed or, to say it another way 87.50 is 7% of the taxed part of the item:

87.5 / taxed part = 0.07

So, when we solve for the unknown in this equation, we end up with the total taxed part of the item, the cost in excess of $1000. At that point, to determine the total price of the item, we must add that first $1000 of the price to the taxed portion of $1250.

Does that make sense, Rachel? I hope this clears up your doubts! If not, please let us know :)

Apr 15, 2016 • Reply

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Guys, does anyone know the answer?