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Question from Gmat Prep- Help please! 4

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bobdylan Rising GMAT Star Default Avatar
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Question from Gmat Prep- Help please! 4 Post Sat Apr 14, 2012 7:20 am
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    An investment of d dollars at k percentsimple annual interest yield $600 interest over a 2-year period. In terms of d, what dollar amount invested at the same rate will yield $2,400 interest over a 3-year period?
    a) 2d/3
    b)3d/4
    c)4d/3
    d)3d/2
    e)8d/3

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    Post Sat Apr 14, 2012 7:50 am
    Quote:
    An investment of d dollars at k percent simple annual interest yields $600 interest over a 2-year period. In terms of d, what dollar amount investment at the same rate will yield $2,400 interest over a 3-year period?

    a) 2d/3
    b) 3d/4
    c) 4d/3
    d) 3d/2
    e) 8d/3

    Thanks,
    We can plug in values.

    Let k = 100% annual interest.
    Thus, the amount of interest per year = the amount invested.

    $600 interest over 2 years = $300 interest per year.
    To earn $300 interest per year, the amount invested = d = 300.

    $2400 interest over 3 years = $800 interest per year.
    To earn $800 interest per year, the amount invested = $800. This is our target.

    Now we plug d=300 into the answers to see which yields our target of 800.

    Only answer choice E works:
    8d/3 = 8*300/3 = 800.

    The correct answer is E.

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    Post Sat Apr 14, 2012 12:08 pm
    bobdylan wrote:
    An investment of d dollars at k percentsimple annual interest yield $600 interest over a 2-year period. In terms of d, what dollar amount invested at the same rate will yield $2,400 interest over a 3-year period?
    a) 2d/3
    b)3d/4
    c)4d/3
    d)3d/2
    e)8d/3
    We know that SI = P.r.t/100; where P= principal, r= rate and t= time,

    then, 600 = d*k*2/100

    => k = 30000/d;

    Again from II condn. 2400 = P*k*3/100;

    By placing the value of k, we get P = 8d/3.

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    Post Sun Apr 15, 2012 12:41 pm
    from basics we are aware that intrest is p*n*r/100.(pricipal number of years and rate respectively).
    thus 600 = 2*r*p/100 hence r*p/100 = 300,

    Also 2400 = 3*r*p1/100 now substituting r/100 as 300/p so we get
    2400 = 3*300*p1/p
    thus we get p1=8p/3


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    Post Sun Apr 15, 2012 9:23 pm
    bobdylan wrote:
    An investment of d dollars at k percentsimple annual interest yield $600 interest over a 2-year period. In terms of d, what dollar amount invested at the same rate will yield $2,400 interest over a 3-year period?
    a) 2d/3
    b)3d/4
    c)4d/3
    d)3d/2
    e)8d/3
    Simple interest = principal * interest rate * time, where
    principal = amount invested
    rate = interest rate

    An investment of d dollars at k percent simple annual interest yields $600 over a 2 year period implies d * k/100 * 2 = 600
    k = 30,000/d

    Let us assume that the amount invested at the same rate which will yield $2,400 over a 3 year period = $x

    Then, x * k/100 * 3 = 2400
    x * (30000/100d) * 3 = 2400
    x = 8d/3

    The correct answer is E.

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