who made more money investing in the stock market

[avenus]

Over the last two years, who made more money investing in the stock market, Leslie or Kerri?

(1) Leslie made an average (arithmetic mean) return of 20%, and Kerri made an average (arithmetic mean) return of 5%.

(2) Kerri started with two times as much money as Leslie.

[Vemuri]

IMO C.

Stmt1: Leslie's return is greater than Kerri's. What we do not know from this statement is return on how much? If Leslie & Kerri invested the same amount of money in the market, then the percentage return would tell us that Leslie made more money. But, without knowing how much each of them invested, we would not know who made more money.

Stmt2: Kerri invested 2 times more than Leslie invested. We do not know how much return they got from the stock market. So, this statement is not sufficient.

Combining both the statements we know that Kerri invested 2 times what Leslie invested & earned 5% returns, while Leslie earned 20%.
i.e. if Leslie invested $100, then Kerri invested $200. The return Leslie got was 20% on her investment. So, this would mean that she earned $20. While Kerri earned 5% on $200, i.e. $10. So, obviously, Leslie earned more than Kerri.

Hence C is the answer.

[avenus]

OA is E. I'd go for C though

[deepoe]

Over the last two years, who made more money investing in the stock market, Leslie or Kerri?

(1) Leslie made an average (arithmetic mean) return of 20%, and Kerri made an average (arithmetic mean) return of 5%.

(2) Kerri started with two times as much money as Leslie.

(1) Doesn't say a value
(2) It doesn't say anything about the money they got.


Both still not give any clue about the money. Because they STARTED with a value. You don't know what happened the last two years with the value of the stocks;)

[maihuna]

actually no one made money in stock market in last two years even not buffet the grt.

coming to this question it seems, if amount is not 0 the ans should be C as its only asking for more :

[hussi9]

This question is present in 800score.
OA - E
IMO- C

Any one who can clarify this

[force5]

Over the last two years, who made more money investing in the stock market, Leslie or Kerri?

(1) Leslie made an average (arithmetic mean) return of 20%, and Kerri made an average (arithmetic mean) return of 5%.

(2) Kerri started with two times as much money as Leslie.

Ok here it goes.....

For us to know who made more money in two years we should know how much money they initially had and how much interest or return they earned.

Stmnt 1- insufficient- since we dont know 20% and 5% of what principle amount.
stmnt2 - insufficient- since we dont know what percentage/or interest rate they earned. someone with more money might have earned lesser @ lower interest rate.

combining.- insufficient. although we have relative value of investments we still dont know the average return mentioned in stmnt 1 is for how much time.
Hence E

[ldoolitt]

Me thinks E is correct.

Each individual statement is insufficient, as some other posters have described.

Both together are insufficient as well. Use the "table method" and come up with two different situations that satisfy the constraints yet yield different answers to the target question.

Situation 1
Leslie: $100
Keri: $200

Leslie makes 20% the first year and 20% the second year.
Keri makes 5% the first year and 5% the second year.

I dont have to calculate any values to tell you that Leslie made more money than Keri.

Situation 2
Leslie: $100
Keri: $200

Leslie makes 140% the first year and -100% the second year (for an average of -100+140/2 = 20% return)
Keri makes 5% the first year and 5 percent the second year

Again, I dont have to do calculations to tell here that Keri makes more than Leslie (Leslie loses it all!)

The key here is to realize its an average return, and the implied constraints on the range of numbers (ie investment returns can be negative)

-EDITED for typo-

[hussi9]

Thanks for the explanation .. Now its very much clear...

The confusion arises due to shortage of time during actual test...

What should be the approach during actual test?

[ldoolitt]

Thanks for the explanation .. Now its very much clear...

The confusion arises due to shortage of time during actual test...

What should be the approach during actual test?

Like I said in the above, I used the "table method" because it was my initial reaction that they were not sufficient. The approach is described here, lesson 7.

https://www.beatthegmat.com/mba/gmat-dat ... ncy-videos

And choosing good numbers for each years return. There is also a lesson on that (lesson 8). Remember that the numbers can be negative unless otherwise stated or implied (like number of people, cars, homes, etc must be positive integers, etc)