Lucy invested $10,000 in a new mutual fund account exactly three years ago. The value of the account increased by 10 percent during the first year, increased by 5 percent during the second year, and decreased by 10 percent during the third year. What is the value of the account today?
(A) $10,350
(B) $10,395
(C) $10,500
(D) $11,500
(E) $12,705
Answer: B
Source: Official Guide
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Lucy invested $10,000 in a new mutual fund account exactly three years ago. The value of the account increased by 10 per
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Start: $10,000VJesus12 wrote: ↑Wed Feb 23, 2022 4:30 amLucy invested $10,000 in a new mutual fund account exactly three years ago. The value of the account increased by 10 percent during the first year, increased by 5 percent during the second year, and decreased by 10 percent during the third year. What is the value of the account today?
(A) $10,350
(B) $10,395
(C) $10,500
(D) $11,500
(E) $12,705
Answer: B
Source: Official Guide
First year +10%
10% of $10,000 = $1000
So, we get $10,000 + $1000 = $11,000
Second year +5%
5% of $11,000 = $550
So, we get $11,000 + $550 = $11,550
Third year -10%
10% of $11,550 = $1,155
So, we get $11,550 - $1155 = $10,395
Answer: B
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