BREAKING: Target Test Prep releases Brand New 2026 On Demand GMAT prep course

Redeem

Tom saved $10,000 at a constant compound interest rate of r

This topic has expert replies
Post new topic Post Reply
Previous Topic Next Topic
User avatar
Elite Legendary Member
Posts: 3991
Joined: Fri Jul 24, 2015 2:28 am
Location: Las Vegas, USA
Thanked: 19 times
Followed by:37 members

Tom saved $10,000 at a constant compound interest rate of r

by Max@Math Revolution » Wed Dec 05, 2018 11:19 pm

Timer

00:00

Your Answer

A

B

C

D

E

Global Stats

[Math Revolution GMAT math practice question]

Tom saved $10,000 at a constant compound interest rate of r percent annually. After 10 years, the balance is double the principal. What will be the balance 30 years after the deposit?

A. $30,000
B. $40,000
C. $50,000
D. $60,000
E. $80,000
Top
Source: — Problem Solving |
User avatar
GMAT Instructor
Posts: 15539
Joined: Tue May 25, 2010 12:04 pm
Location: New York, NY
Thanked: 13060 times
Followed by:1906 members
GMAT Score:790

by GMATGuruNY » Thu Dec 06, 2018 3:43 am
Max@Math Revolution wrote:[Math Revolution GMAT math practice question]

Tom saved $10,000 at a constant compound interest rate of r percent annually. After 10 years, the balance is double the principal. What will be the balance 30 years after the deposit?

A. $30,000
B. $40,000
C. $50,000
D. $60,000
E. $80,000

Original deposit: 10,000.
The balance doubles every 10 years.
After 10 years, we get:
2*10,000 = 20,000.
After 20 years, we get:
2*20,000 = 40,000.
After 30 years, we get:
2*40,000 = 80,000.

The correct answer is E.
Private tutor exclusively for the GMAT and GRE, with over 20 years of experience.
Followed here and elsewhere by over 1900 test-takers.
I have worked with students based in the US, Australia, Taiwan, China, Tajikistan, Kuwait, Saudi Arabia -- a long list of countries.
My students have been admitted to HBS, CBS, Tuck, Yale, Stern, Fuqua -- a long list of top programs.

As a tutor, I don't simply teach you how I would approach problems.
I unlock the best way for YOU to solve problems.

For more information, please email me (Mitch Hunt) at [email protected].
Student Review #1
Student Review #2
Student Review #3
Top
User avatar
Newbie | Next Rank: 10 Posts
Posts: 7
Joined: Mon Nov 19, 2018 8:18 am

by abhishekgoswami1234u » Thu Dec 06, 2018 8:12 am
The question says,the balance got doubled in 10 years of time.This means Balance after 10 years is 10,000*2= 20,000$ .Going by the same logic, and since in 20 years, the balance will be double of the balance in 10 years, which means 20,000*2= 40,000$. In another 10 years, that means, at the end of 30 years, the balance will again double up. The final balance will thus become 40,000*2= 80,000$.

Hence Answer
Top
User avatar
Elite Legendary Member
Posts: 3991
Joined: Fri Jul 24, 2015 2:28 am
Location: Las Vegas, USA
Thanked: 19 times
Followed by:37 members

by Max@Math Revolution » Sun Dec 09, 2018 5:49 pm
=>

After 10 years, we have 10,000(1+r)^10 = 20,000 or (1+r)^10 = 2.
So, after 30 years the balance is 10,000(1+r)^30 = 10,000((1+r)^10)^3= 10,000*2^3 =10,000*8 = 80,000.

Therefore, the answer is E.
Answer: E
Top
Post new topic Post Reply
• Page 1 of 1