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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