ACME Products is located in England and ships its products to customers in many European nations. ACME offers both standard...
GMAT Multi Source Reasoning : (MSR) Questions
ACME Products is located in England and ships its products to customers in many European nations. ACME offers both standard and express delivery to destinations within its six delivery zones (see Orders and Zones tab). Express delivery costs twice as much as standard delivery, but guarantees that products will arrive at their destination one weekday sooner than with standard delivery in Zone 1, and two weekdays sooner than with standard delivery in Zones 2 through 6. (Weekdays are Monday through Friday) However, express delivery is available for the same cost as standard delivery on any order with a base cost—the total cost of the products ordered, before shipping and taxes—of 100 pounds sterling (£) or more.
Delivery includes, at no charge, insurance of £10 per kilogram against damage during shipping. Extra insurance can be purchased for orders using standard shipping only, at a cost of £1 for each additional 10 per kilogram of insurance.
Suppose that Order F weighs exactly \(\mathrm{25\,kg}\), is shipped using standard shipping, and is insured for exactly \(\mathrm{£300}\) against damage during shipping. Which one of the following is the total cost of extra insurance, if any, that has been purchased for this order?
OWNING THE DATASET
Understanding Source A: Policy Document - ACME Products Shipping Policies
| Information from Dataset | Analysis |
|---|---|
| "ACME Products is located in England and ships its products to customers in many European nations" |
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| "Express delivery costs twice as much as standard delivery" |
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| "Express delivery...guarantees that products will arrive at their destination one weekday sooner than with standard delivery in Zone 1, and two weekdays sooner than with standard delivery in Zones 2 through 6" |
|
| "express delivery is available for the same cost as standard delivery on any order with a base cost...of 100 pounds sterling (£) or more" |
|
| "Delivery includes, at no charge, insurance of £10 per kilogram" |
|
| "Extra insurance can be purchased for orders using standard shipping only, at a cost of £1 for each additional 10 per kilogram of insurance" |
|
Summary: ACME's shipping policies establish two delivery options (standard and express) with specific time savings and pricing rules, plus an insurance system providing basic coverage with optional additional protection for standard shipments only.
Understanding Source B: Question - Order F Scenario
| Information from Dataset | Analysis |
|---|---|
| "Order F weighs exactly 25 kg" |
|
| "shipped using standard shipping" |
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| "insured for exactly £300 against damage during shipping" |
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| "Which one of the following is the total cost of extra insurance, if any, that has been purchased for this order?" |
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Summary: Source B presents a specific calculation scenario for Order F, requiring application of Source A's insurance policies to determine that \(£50\) of extra insurance (beyond the automatic \(£250\)) costs \(£50\) total.
Understanding Source C: Shipping Table - Zone-Based Pricing Structure
| Information from Dataset | Analysis |
|---|---|
| Table shows standard shipping costs, included weights, extra weight charges, and delivery times for 6 zones |
|
| Zone costs increase progressively: £6 (Zone 1) to £25 (Zone 6) |
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| Included weight allowances increase: 20kg (Zone 1) to 30kg (Zone 6) |
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| Extra kg charges increase: £0.25 (Zones 1-2) to £1.00 (Zone 6) |
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| Delivery times increase: 2 weekdays (Zone 1) to 7 weekdays (Zone 6) |
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| Order F (25kg) analysis across zones |
|
Summary: The shipping table operationalizes the zone system from Source A, showing how costs and delivery times vary by destination, which directly impacts calculations for specific orders like Order F.
Overall Summary
- ACME Products operates a comprehensive shipping system from England to European destinations using 6 zones with progressive pricing
- The system offers standard and express delivery options, with express costing double but saving 1-2 weekdays depending on zone
- All shipments include automatic insurance of \(£10/\mathrm{kg}\), with extra insurance available only for standard shipping at \(£1\) per \(£10/\mathrm{kg}\) of additional coverage
- The zone-based pricing structure means identical orders face different shipping costs and excess weight charges depending on destination
- This creates complex trade-offs between speed, cost, and insurance coverage for customers
Question Analysis
The question asks: What is the cost of purchasing additional insurance beyond the automatic coverage for a 25kg order that has £300 total insurance?
Key Constraints:
- Order F weighs exactly 25 kg
- Uses standard shipping
- Total insurance is exactly £300
- Need to find cost of EXTRA insurance only
Answer Type Needed: Numerical calculation to determine extra insurance cost
Connecting to Our Analysis
The analysis contains Source A's insurance policies showing automatic coverage of £10/kg and extra insurance cost of £1 per additional £10/kg. Combined with Order F details, I can calculate the extra insurance cost.
Can answer from analysis alone: YES - All necessary information is in the collated analysis
Extracting Relevant Findings
Calculating extra insurance cost based on automatic coverage and total insurance amount. Automatic insurance coverage = \(\mathrm{25\,kg \times £10/kg = £250}\)
Hypothesis: Extra insurance needed = \(\mathrm{£300 - £250 = £50}\), which costs £1 per £10 of coverage
Individual Statement Evaluations
Statement 1 Evaluation: £0.00
In plain terms: £0.00 - This would mean no extra insurance was purchased
- This option suggests no extra insurance was purchased, with a difference of -£5.00 from the calculated cost
- This is incorrect because the total insurance of £300 exceeds the automatic coverage of £250, so extra insurance was definitely purchased
Statement 2 Evaluation: £0.50
In plain terms: £0.50 - This would be the cost for £5 of extra insurance
- This option represents £0.50 compared to the calculated cost of £5.00, showing a difference of -£4.50
- This is incorrect because this amount would only buy £5 of extra coverage, not the £50 needed to reach the total insurance of £300
Statement 3 Evaluation: £1.00
In plain terms: £1.00 - This would be the cost for £10 of extra insurance
- This option represents £1.00 compared to the calculated cost of £5.00, showing a difference of -£4.00
- This is incorrect because this amount would only buy £10 of extra coverage, not the £50 needed to reach the total insurance of £300
Statement 4 Evaluation: £5.00
In plain terms: £5.00 - This is the cost for £50 of extra insurance (5 units × £1)
- This option shows £5.00 which exactly matches the calculated cost of £5.00, with no difference
- This is correct as it represents the proper cost for £50 of extra insurance coverage needed
Statement 5 Evaluation: £10.00
In plain terms: £10.00 - This would be the cost for £100 of extra insurance
- This option represents £10.00 compared to the calculated cost of £5.00, showing a difference of +£5.00
- This is incorrect because this amount would buy £100 of extra coverage, which exceeds the £50 needed
Systematic Checking
Verification of insurance calculation against Source A policies:
- Automatic coverage: \(\mathrm{25\,kg \times £10/kg = £250}\) ✓
- Total insurance needed: £300 (given) ✓
- Extra insurance amount: \(\mathrm{£300 - £250 = £50}\) ✓
- Extra insurance cost: \(\mathrm{£50 ÷ £10\,per\,unit \times £1\,per\,unit = £5.00}\) ✓
- Standard shipping allows extra insurance purchase (per Source A) ✓
Final Answer
£5.00
£0.00
£0.50
£1.00
£5.00
£10.00