A certain amount was deposited at bank A at a rate of x

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A certain amount was deposited at bank A at a rate of x [#permalink]

30 Aug 2008, 03:36

A certain amount was deposited at bank A at a rate of x percent compounded annually and half that amount was deposited at bank B at a rate of y percent compounded annually. In three years, will the total amount on deposit in bank A be bigger than that on deposit in bank B?

1. y = 0.8x
2. The difference between the amounts initially deposited was $100

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Re: simple interest [#permalink]

30 Aug 2008, 13:01

arjtryarjtry wrote:

A

let A = 200, so that B = 100

statement1: if you start with a bigger amount, and earn a greater interest percentage on that amount, then it is obvious that you will have more. Suff

statement 2: Let A = 200 and B = 100, if x = 1% and y = 100%, then B will be bigger. But if x = 1% and y=1%, then A will be bigger. Insuff

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Re: simple interest [#permalink]

30 Aug 2008, 13:04

Although the topic is "simple interest", the task is for compound interests

The amount of money received after three years depends on two variables: interest rate and amount of deposited money.

As far as there is a direct correlation between these two variables, the more money we deposit or the higher the interest rate is, the more money we will get in 3 years.

We know that second amount is twice less. The 1-st condition tells us that interest rate in bank B is less than in bank A, so we deposited less money at less interest rate in bank B, and after 3 years we will get less money, of course, than from bank A. This condition is enough for us to answer the question.

2nd condition only tells us about the difference in amounts but nothing about the interest rates, so it is not sufficient to answer the question.

Answer is A.

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Re: simple interest [#permalink]

30 Aug 2008, 13:30

arjtryarjtry wrote:

Clear A.

1)
Bank A has.. more deposit and more interset rate

2)
we don't know about interst rates..
insuffcient
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Re: simple interest [#permalink] 30 Aug 2008, 13:30

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A certain amount was deposited at bank A at a rate of x

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A certain amount was deposited at bank A at a rate of x

A certain amount was deposited at bank A at a rate of x

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