CAT 2018 Question Paper Shift 1 Solved Paper

To dispense the smallest possible number of notes to a person with 500 rupee notes as his/her preference, the ATM should dispense all 500 rupee notes. Hence, minimum number of notes required to serve any person with 500 rupee notes as his\/her preference $=10$ (all of 500 rupees).
Total number of 500 rupee notes required to serve 50 customers with 500 rupee notes as his\/her preference $=10\times 50=500$
To minimize the number of notes to be served to a person with 100 rupee notes as his\/her preference, we can maximize the number of 500 rupee notes served to him, keeping the 100 rupee notes more than the sum of the other two denominations.
This is possible if the machine serves eight 500 rupee notes and ten 100 rupee notes. Hence, the total number of 500 rupee notes required to serve 50 customers with 100 rupee notes as his/her preference $=8\times 50=400$
Total number of 500 rupee notes required in the given scenario $=500+400=900$
Note: Given that the ATM dispenses 500,200 and 100 rupee notes. A possible interpretation of this is that at least one note of each denomination is dispensed. However, as there is no additional information supporting this, you should also consider the cases in which not all the three denominations are dispensed.