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.

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:

An investor buys a bond of a certain company for $1000 and [#permalink]
02 Jul 2004, 00:45

00:00

A

B

C

D

E

Difficulty:

(N/A)

Question Stats:

0% (00:00) correct
0% (00:00) wrong based on 0 sessions

An investor buys a bond of a certain company for $1000 and leaves for a one-year vacation. At the moment of buying, the bonds are going to increase at the annual rate of 8% compounded quarterly. However, after the first quarter, the investment starts losing its value at the same rate. When the investor is back, what the difference (rounded to dollars) he will see between expected and real balances?

This is not a GMAT-like question.
This sort of question is being tested on CFA, where it takes 10 seconds to solve, but you're given a calculator as well.

Well, if answer choices had something around 120, I would have taken it.
It's just to know that expected is slightly over 1080 since it's compounded quarterly and realized is about 1020-60 = 960. Difference between the 2 is approx. 120 _________________