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

Redeem

Target Test Prep · GMAT

Choose how you want to prepare

Learn live with an expert or move at your own pace. Every option includes the complete TTP study system.

★★★★★5.0559 reviews
GMATLiveTeach Starts Oct 17
Chris Peckover, Target Test Prep GMAT expert
LIVE ONLINE CLASSES

Get Ready for GMAT Test Day Faster with Live Online Classes

with Chris Peckover, 100th-Percentile GMAT Scorer

Oct 17 · Chris Peckover
Sat · 11:00 AM to 2:00 PM ET
Oct 20 · Chris Peckover
Tue, Thu · 8:00 to 10:00 PM ET
Oct 25 · Josh Braslow
Sun · 1:00 to 4:00 PM ET
Included
40 hours of live online classes + 6 months of TTP OnDemand
  • Attend the first class for free
  • Every class is recorded, so you never fall behind
View classes & enroll
Limited seats availableTarget Test Prep
EALiveTeachOnDemand 5 seats left Start anytime
EXECUTIVE ASSESSMENT

Target Test Prep EA OnDemand

Self-paced EA prep. Study on your schedule.

Logan Thompson
EXECUTIVE ASSESSMENT

Sep 6 to Dec 6, 2026

with Logan Thompson

165+ EA score guarantee
$05-day trial no automatic billing
Schedule
Sun · 9:30 AM to 12:30 PM ET
Included
40 hours of live online classes plus six months of access to the complete TTP EA OnDemand course.
  • 165+ EA Score Guarantee
  • 4,100+ Quant, Verbal, and Integrated Reasoning practice questions
  • 400+ hours of in-depth video lessons
  • 3,000+ step-by-step video solutions
View EA class & enroll Start free 5-day trial
Limited cohort · enrollment openTrial includes full course accessTarget Test Prep
GMATOnDemand Start anytime
SELF-PACED MASTERCLASS

Target Test Prep GMAT OnDemand

Complete access from day one. Study on your schedule.

715+ score guarantee
$0to start then $127/mo
  • Personalized study plan and analytics
  • Thousands of lessons and practice questions
Start free 5-day trial
Read 559 reviewsTarget Test Prep

Compare the format, schedule, and included access before enrolling. Prices and seat counts shown reflect the supplied offer details.

Compound interest problem

Expert replies
Post new topic Post Reply
Previous Topic Next Topic
Legendary Member
Posts: 641
Joined: Tue Feb 14, 2012 3:52 pmFollowed by: 8 members
Thanked: 11 times
by gmattesttaker2 » Thu Jul 05, 2012 10:44 pm
Hello,

Came across this problem in MGMAT Guide 1 (5th edition)

A bank account with $100 earns 8% annual interest, compounded quarterly. If there are no deposits or withdrawals, how much money will be in the account after 6 months?

[spoiler]Answer is $104.04[/spoiler]

Wasn't clear with the solution given there. Can you please assist? Thanks a lot.

Best Regards,
Sri
Top
Join the discussion
Log in to postLogin with Googleuse password
QUOTE IN REPLY
Source: — Problem Solving |
User avatar
Legendary Member
Posts: 520
Joined: Sat Apr 28, 2012 9:12 pmFollowed by: 49 members
Thanked: 339 times
GMAT Score:770

by eagleeye » Fri Jul 06, 2012 3:13 am
For compound interest: Total amount after time t = A = P*(1+r/100)^t.

A bank account with $100 earns 8% annual interest, compounded quarterly. If there are no deposits or withdrawals, how much money will be in the account after 6 months?

There are 4 quarters each year. Each has 3 months in it.
Since interest is compounded quarterly, we need to find the quarterly rate.
Quarterly rate r= Annual Rate/(Number of Quarters in one year) = 8/4 = 2%.
We need to find the amount after 6 months, i.e. 2 quarters, so time t = 2.
Principal P = 100.

Now its easy.
Amount A = P*(1+r/100)^t = 100* (1+2/100)^2 = 100* 1.02^2 = 100* 1.0404 = 104.04
Top
Join the discussion
Log in to postLogin with Googleuse password
QUOTE IN REPLY
Post new topic Post Reply
• Page 1 of 1