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Linda put an amount of money into each of two new investments, A and B, that pay simple annual interest. If the annual interest rate of investment B is 1 1/2 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 4150 for investment B.
2) The amount that Linda put into investment B is twice the amount that she put into investment A.
OA E
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Linda put an amount of money into each of two new investment
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Say, the annual interest rate of investment A = r and the annual interest rate of investment A = R; the amount of money invested in investment A = $A and the amount of money invested in investment B = $BAAPL wrote:GMAT Prep
Linda put an amount of money into each of two new investments, A and B, that pay simple annual interest. If the annual interest rate of investment B is 1 1/2 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.
OA E
Thus, we have R = 1.5r
We have to get the value of A.
Let's take each statement one by one.
1) The interest for 1 year is $50 for investment A and $150 for investment B.
=> 50 = A*r*1/100 => A*r = 5,000 ---(1) and
150 = B*R*1/100 => B*R = 15,000 => B*1.5r = 15,000 => B*r = 10,000 ---(2)
From (1) and (2), we have A = B/2. Can't get the value of A. Insufficient.
2) The amount that Linda put into investment B is twice the amount that she put into investment A.
A = B/2. Same result that we got in Statement (1). Insufficient.
(1) and (2) together
We have A = B/2; Can't get the value of A. Insufficient.
The correct answer: E
Hope this helps!
-Jay
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