Find all School-related info fast with the new School-Specific MBA Forum

It is currently 23 Oct 2014, 06:11

Close

GMAT Club Daily Prep

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.

Events & Promotions

Events & Promotions in June
Open Detailed Calendar

Louie takes out a three-month loan of $1000. The lender

  Question banks Downloads My Bookmarks Reviews Important topics  
Author Message
TAGS:
CEO
CEO
User avatar
Joined: 21 Jan 2007
Posts: 2769
Location: New York City
Followers: 8

Kudos [?]: 255 [0], given: 4

Louie takes out a three-month loan of $1000. The lender [#permalink] New post 18 Dec 2007, 08:18
Louie takes out a three-month loan of $1000. The lender charges him
10% interest per month compunded monthly. The terms of the loan state
that Louie must repay the loan in three equal monthly payments. To the
nearest dollar, how much does Louie have to pay each month?

(A) 333
(B) 383
(C) 402
(D) 433
(E) 483
Senior Manager
Senior Manager
avatar
Joined: 06 Aug 2007
Posts: 370
Followers: 1

Kudos [?]: 22 [0], given: 0

Re: compound interest [#permalink] New post 18 Dec 2007, 17:41
bmwhype2 wrote:
Louie takes out a three-month loan of $1000. The lender charges him
10% interest per month compunded monthly. The terms of the loan state
that Louie must repay the loan in three equal monthly payments. To the
nearest dollar, how much does Louie have to pay each month?

(A) 333
(B) 383
(C) 402
(D) 433
(E) 483


I am getting $443 per month.
Manager
Manager
avatar
Joined: 03 Sep 2006
Posts: 233
Followers: 1

Kudos [?]: 5 [0], given: 0

 [#permalink] New post 18 Dec 2007, 18:33
1 month: 1100
2 month: 1210
3 month: 1331
each month: 1331 / 3 ~ 433
Manager
Manager
User avatar
Joined: 11 Dec 2007
Posts: 121
Followers: 1

Kudos [?]: 5 [0], given: 0

 [#permalink] New post 19 Dec 2007, 11:41
Isn't it 402 assuming that the payments are made after the loan is taken, while interest is accuing.

Month 1: 1100
Minus 1st payment of 402: 698
Month 2: 698*1.1=768
Minus 2nd payment of 402: 365
Month 3: 365*1.1=402
Minus last payment: 0

What is the OA?
  [#permalink] 19 Dec 2007, 11:41
    Similar topics Author Replies Last post
Similar
Topics:
1 Experts publish their posts in the topic Taking Out a Larger Loan Amount HopefulApplicant22 5 25 Mar 2014, 12:53
Where should I Go? Take the money or take out loans? SunnyAnd75 2 07 Feb 2014, 14:30
29 Experts publish their posts in the topic Louie takes out a three-month loan of $1000. The lender sachinrelan 27 22 Sep 2010, 08:39
choosing a lender for stafford & gradplus loans polobrute 2 12 Jun 2007, 22:42
1 Experts publish their posts in the topic Louie takes out a three-month loan of $1000. The lender mm007 6 20 Dec 2006, 13:35
Display posts from previous: Sort by

Louie takes out a three-month loan of $1000. The lender

  Question banks Downloads My Bookmarks Reviews Important topics  


GMAT Club MBA Forum Home| About| Privacy Policy| Terms and Conditions| GMAT Club Rules| Contact| Sitemap

Powered by phpBB © phpBB Group and phpBB SEO

Kindly note that the GMAT® test is a registered trademark of the Graduate Management Admission Council®, and this site has neither been reviewed nor endorsed by GMAC®.