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Gmat Prep - Simple interest

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dubeystuts: Senior | Next Rank: 100 Posts; Posts: 72; Joined: Sat Aug 23, 2008 3:26 am; Thanked: 1 times

Gmat Prep - Simple interest

by dubeystuts » Sat Jan 31, 2009 4:57 am

Robin split a total of $24000 between two investments, X and Y. If investment Y earns 7 percent simple annual interest, how much of the total did Robin put into investment Y>
1) Each investment earns the same dollar amount of interest anually
2) investment x earns 5 percent simple annual interest

Correct answer is C.

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Source: Beat The GMAT — Data Sufficiency | Sat Jan 31, 2009 4:57 am

DanaJ: Site Admin; Posts: 2567; Joined: Thu Jan 01, 2009 10:05 am; Thanked: 712 times; Followed by:550 members; GMAT Score:770

by DanaJ » Sat Jan 31, 2009 5:13 am

1 is insufficient because we do not know any relationship between the interest rates or the sums of money.
2 is insufficient because you can't tell anything about investment y, since, again, you do not have a relationship between x and y.

Put together, the two stmts are more efficient in solving the mystery. Since we know that 0.07y = 0.05x or that 7y = 5x and we also know that x + y = 24000. This is a simple set of equations with two unknown numbers, x and y.
So 7y = 5x
x + y = 24 000
Solve this system and you'll get the answer.

So answer is C.

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blitz28: Senior | Next Rank: 100 Posts; Posts: 30; Joined: Sun Nov 02, 2008 7:32 pm; Thanked: 2 times

by blitz28 » Sat Jan 31, 2009 9:46 pm

Hey Dubestuts,

From The question Stem we have X+Y= 24000.
So let X be x, Y be (24000-x)

Y earns 7% interest.

St1) does not give us any information
St2)Gives info about X, but nothing abt principle amt for Y

Now Put this into simple interest formula Using St 1 &St 2
SI= (P*R*T)/100
(x*7*1)/100= ((24000-x)*5*1)/100

Gives value for both X and Y and SI!!

C is the answer