Thank you for using the timer - this advanced tool can estimate your performance and suggest more practice questions. We have subscribed you to Daily Prep Questions via email.

Customized for You

we will pick new questions that match your level based on your Timer History

Track Your Progress

every week, we’ll send you an estimated GMAT score based on your performance

Practice Pays

we will pick new questions that match your level based on your Timer History

Not interested in getting valuable practice questions and articles delivered to your email? No problem, unsubscribe here.

It appears that you are browsing the GMAT Club forum unregistered!

Signing up is free, quick, and confidential.
Join other 350,000 members and get the full benefits of GMAT Club

Registration gives you:

Tests

Take 11 tests and quizzes from GMAT Club and leading GMAT prep companies such as Manhattan GMAT,
Knewton, and others. All are free for GMAT Club members.

Applicant Stats

View detailed applicant stats such as GPA, GMAT score, work experience, location, application
status, and more

Books/Downloads

Download thousands of study notes,
question collections, GMAT Club’s
Grammar and Math books.
All are free!

Thank you for using the timer!
We noticed you are actually not timing your practice. Click the START button first next time you use the timer.
There are many benefits to timing your practice, including:

A certain investment grows at an annual interest rate of 8%, [#permalink]
18 Nov 2009, 20:41

4

This post was BOOKMARKED

00:00

A

B

C

D

E

Difficulty:

95% (hard)

Question Stats:

40% (02:01) correct
60% (00:52) wrong based on 251 sessions

A certain investment grows at an annual interest rate of 8%, compounded quarterly. Which of the following equations can be solved to find the number of years, x, that it would take for the investment to increase by a factor of 16?

A. 16 = 1.02^(x/4) B. 2 = 1.02^x C. 16 = 1.08^(4x) D. 2 = 1.02^(x/4) E. 1/16 = 1.02^(4x)

Re: A certain investment grows at an annual interest rate of 8%, [#permalink]
18 Nov 2009, 22:52

kairoshan wrote:

A certain investment grows at an annual interest rate of 8%, compounded quarterly. Which of the following equations can be solved to find the number of years, x, that it would take for the investment to increase by a factor of 16? 16 = (1.02)x/4 2 = (1.02)x 16 = (1.08)4x 2 = (1.02)x/4 1/16 = (1.02)4x

A certain investment grows at an annual interest rate of 8%, compounded quarterly. Which of the following equations can be solved to find the number of years, x, that it would take for the investment to increase by a factor of 16? 16 = (1.02)x/4 2 = (1.02)x 16 = (1.08)4x 2 = (1.02)x/4 1/16 = (1.02)4x

A certain investment grows at an annual interest rate of 8%, compounded quarterly. Which of the following equations can be solved to find the number of years, x, that it would take for the investment to increase by a factor of 16? 16 = (1.02)x/4 2 = (1.02)x 16 = (1.08)4x 2 = (1.02)x/4 1/16 = (1.02)4x

If we apply 8% annual interest, compounded quarterly, then we apply one quarter of the interest (or 2% interest) four times per year. That is, in one year, we will multiply the value of our investment by 1.02 four times, or in other words, by (1.02)^4. So, if we invest for x years, we will apply 2% interest 4x times, so will multiply the value of our initial investment by (1.02)^(4x). Now, we know that the value has increased by a factor of 16, so

If you are looking for online GMAT math tutoring, or if you are interested in buying my advanced Quant books and problem sets, please contact me at ianstewartgmat at gmail.com

A certain investment grows at an annual interest rate of 8%, compounded quarterly. Which of the following equations can be solved to find the number of years, x, that it would take for the investment to increase by a factor of 16? 16 = (1.02)x/4 2 = (1.02)x 16 = (1.08)4x 2 = (1.02)x/4 1/16 = (1.02)4x

If we apply 8% annual interest, compounded quarterly, then we apply one quarter of the interest (or 2% interest) four times per year. That is, in one year, we will multiply the value of our investment by 1.02 four times, or in other words, by (1.02)^4. So, if we invest for x years, we will apply 2% interest 4x times, so will multiply the value of our initial investment by (1.02)^(4x). Now, we know that the value has increased by a factor of 16, so

(1.02)^(4x) = 16 (1.02^x)^4 = 2^4 1.02^x = 2

Thanks, i was confused with 8% annual rate. If the question was like 8% interest rate means we will take 1.08 only rgt?

Re: A certain investment grows at an annual interest rate of 8%, [#permalink]
13 Nov 2013, 10:33

Hello from the GMAT Club BumpBot!

Thanks to another GMAT Club member, I have just discovered this valuable topic, yet it had no discussion for over a year. I am now bumping it up - doing my job. I think you may find it valuable (esp those replies with Kudos).

Want to see all other topics I dig out? Follow me (click follow button on profile). You will receive a summary of all topics I bump in your profile area as well as via email. _________________

Re: A certain investment grows at an annual interest rate of 8%, [#permalink]
03 Aug 2014, 04:39

A certain investment grows at an annual interest rate of 8%, compounded quarterly. Which of the following equations can be solved to find the number of years, x, that it would take for the investment to increase by a factor of 16?[/b]

I am confused by the wording here:

It is implied in the OA that "increase by a factor of 16" means that the Amount increased to 16 times its original amount.

Don't you think that "increase by a factor of 16" means [b]x + 16x?

Re: A certain investment grows at an annual interest rate of 8%, [#permalink]
12 Aug 2014, 08:22

1

This post received KUDOS

Expert's post

pratikshr wrote:

A certain investment grows at an annual interest rate of 8%, compounded quarterly. Which of the following equations can be solved to find the number of years, x, that it would take for the investment to increase by a factor of 16?[/b]

I am confused by the wording here:

It is implied in the OA that "increase by a factor of 16" means that the Amount increased to 16 times its original amount.

Don't you think that "increase by a factor of 16" means [b]x + 16x?

Hope an expert clarifies this doubt!

Increasing something by a factor of x means multiplying by x. _________________

On September 6, 2015, I started my MBA journey at London Business School. I took some pictures on my way from the airport to school, and uploaded them on...

When I was growing up, I read a story about a piccolo player. A master orchestra conductor came to town and he decided to practice with the largest orchestra...

I’ll start off with a quote from another blog post I’ve written : “not all great communicators are great leaders, but all great leaders are great communicators.” Being...