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clear this b4 leaving word.prbl :) 550-600

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by Night reader » Mon Nov 22, 2010 11:31 pm
Emily wants to earn $40 in interest over a 1-year period from a savings account. The principal she must deposit varies inversely with the interest rate of the account. If the interest rate is 5%, she must deposit $500. If the interest rate is 4%, how much she must deposit?
A. $400
B. $525
C. $540
D. $625
E. $440
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by goyalsau » Mon Nov 22, 2010 11:54 pm
Night reader wrote:Emily wants to earn $40 in interest over a 1-year period from a savings account. The principal she must deposit varies inversely with the interest rate of the account. If the interest rate is 5%, she must deposit $500. If the interest rate is 4%, how much she must deposit?
A. $400
B. $525
C. $540
D. $625
E. $440
Principle is inversely proportional to interest rate,

P = K / I { K - Constant }

500 = K / 5

K = 2500

P = 2500/4

P = 625

Option D/
Saurabh Goyal
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by Night reader » Tue Nov 23, 2010 12:51 am
Thank you Goyalsau for clearing this question.
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My knowledge frontiers came to evolve the GMATPill's methods - the credited study means to boost the Verbal competence. I really like their videos, especially for RC, CR and SC. You do check their study methods at https://www.gmatpill.com
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