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

Redeem
TTP OnDemand GMAT Video Course
Featured Course

Target Test Prep GMAT OnDemand

Scott Woodbury-Stewart’s private virtual classroom — 400 hours of master-class video lessons for the GMAT Focus Edition.

  • 715+ score guarantee — highest in the industry (99th percentile)
  • 52 chapters · 1,500+ lessons · 4,000+ practice questions
  • 400 hours of video · 1,500+ instructor-led HD smartboard lessons
  • 300,000+ students accepted to Harvard, Stanford, Wharton, Booth & Sloan & more
  • 24/7 live support + weekly Zoom office hours with GMAT instructors
  • TTP AI Assist — 24/7 AI-powered virtual tutor for instant help
  • 1,200+ flashcards + AI-powered study assistant & daily calendar
  • OnDemand, LiveTeach & GMAT Bootcamp formats available
  • Also: GRE, SAT Math & Executive Assessment courses
  • MBA Admissions Consulting now available
  • 🏆 2025 EdTech Breakthrough Award: Test Prep Solution Provider of the Year
  • 200,000+ students served
  • 5-day free trial — $0 to start, no auto-billing, cancel anytime
★★★★★ 5.0 (559 reviews)
130-pt guarantee
$0 to start then $127/mo
Start Free 5-Day Trial Read 559 Reviews →

Last year

Expert replies
Post new topic Post Reply
Previous Topic Next Topic
User avatar
Junior | Next Rank: 30 Posts
Posts: 11
Joined: Mon Feb 06, 2017 12:24 am
by REINE » Wed Mar 22, 2017 12:19 am
Last year, a certain bond with face value of $5000 yielded 8% of its face value in interest. If that interest was approximately 6.5% of the bond selling price. Approximately what was the bond's selling price.
A. $4063
B. $5325
C. $5351
D. $6000
E. $6154
Top
Join the discussion
Log in to postLogin with Googleuse password
QUOTE IN REPLY
Source: — Problem Solving |

GMAT/MBA Expert

User avatar
GMAT Instructor
Posts: 16207
Joined: Mon Dec 08, 2008 6:26 pmFollowed by: 1268 members
Location: Vancouver, BC
Thanked: 5254 times
GMAT Score:770

by Brent@GMATPrepNow » Wed Mar 22, 2017 8:05 am
REINE wrote:Last year, a certain bond with face value of $5000 yielded 8% of its face value in interest. If that interest was approximately 6.5% of the bond selling price. Approximately what was the bond's selling price.
A. $4063
B. $5325
C. $5351
D. $6000
E. $6154
Last year, a certain bond with face value of $5000 yielded 8% of its face value in interest.
8% interest on the $5000 bond = (0.08)(5000) = $400.

... that interest was approximately 6.5% of the bond selling price.
In other words, 6.5% of the selling price ≈ $400

Let B be the bond selling price.
So, 6.5% of B ≈ $400
Rewrite: (6.5/100)B ≈ $400
Multiply both sides by 100/6.5 to get: B ≈ (100/6.5)($400)
Or: B ≈ 40000/6.5
B ≈ 6150

Answer: E

Cheers,
Brent
Brent Hanneson - Creator of GMATPrepNow.com
Image
Top
Join the discussion
Log in to postLogin with Googleuse password
QUOTE IN REPLY

GMAT/MBA Expert

User avatar
Elite Legendary Member
Posts: 10392
Joined: Sun Jun 23, 2013 6:38 pmFollowed by: 511 members
Location: Palo Alto, CA
Thanked: 2867 times
GMAT Score:800

by [email protected] » Wed Mar 22, 2017 12:24 pm
Hi REINE,

This question can be solved with a mix of arithmetic and TESTing THE ANSWERS.

We're told that a bond with a face value of $5,000 yielded 8% in interest. That interest is (5,000)(.08) = $400.

Next, we're told that this interest is approximately 6.5% of the SELLING price of the bond. We're asked for that selling price. Since the answer choices are all possible prices, we can use them 'against' the prompt and find the one - that when you take about 6.5% of it - equals $400.

Let's TEST Answer D: $6,000

(6,000)(.065) = $390

This is too low (remember, it's supposed to be $400), so we're looking for a price that's a bit higher than $6,000. Since there's only one answer that fits that description, it must the answer.

Final Answer: E

GMAT assassins aren't born, they're made,
Rich
Contact Rich at [email protected]
Image
Top
Join the discussion
Log in to postLogin with Googleuse password
QUOTE IN REPLY
Post new topic Post Reply
• Page 1 of 1