Linda's investments (GMAT Prep 2)

[alex.gellatly]

Linda put an amount of money into each of two new investment, A and B, that pay simple annual interest. If the annual interest rate of investment B is 3/2 times that of investment A, what amount did Linda put into investment A?

1. The interest for 1 year is $50 for investment A and $150 for investment B.
2. The amount that Linda put into investment B is twice the amount that she put into investment A.

[Anurag@Gurome]

Linda put an amount of money into each of two new investment, A and B, that pay simple annual interest. If the annual interest rate of investment B is 3/2 times that of investment A, what amount did Linda put into investment A?

1. The interest for 1 year is $50 for investment A and $150 for investment B.
2. The amount that Linda put into investment B is twice the amount that she put into investment A.

Let us assume that Linda put $a into investment A and $b into investment B.
Also assume that the annual rate of interest of A is 2r%.
Hence, the annual rate of interest of B is 3r%.

Statement 1: 2ar/100 = 50 and 3br/100 = 150
Hence, ar = 2500 and br = 5000
Hence, b = 2a

Not sufficient

Statement 2: b = 2a --> Same as statement 1

Not sufficient

1 & 2 Together No new information

Not sufficient

The correct answer is E.