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Over the last two years who made more investing in stock

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Intern
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Joined: 16 Aug 2012
Posts: 7
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Kudos [?]: 0 [0], given: 0

Over the last two years who made more investing in stock [#permalink] New post 19 Oct 2012, 05:06
00:00
A
B
C
D
E

Difficulty:

  45% (medium)

Question Stats:

44% (01:49) correct 55% (01:12) wrong based on 72 sessions
Over the last two years who made more investing in stock market Lisa or Kalley.

(1) Lisa made an average (arithmetic mean) return 20 % while Kalley made an average (arithmetic mean) return of 5%
(2) Kalley started with two times as much money as Lisa

What is the strategy for solving these type of questions?
[Reveal] Spoiler: OA

Last edited by Bunuel on 19 Oct 2012, 06:00, edited 2 times in total.
Cleaned up
Intern
Intern
Joined: 01 Jun 2012
Posts: 26
Concentration: Entrepreneurship, Social Entrepreneurship
WE: Information Technology (Consulting)
Followers: 0

Kudos [?]: 5 [0], given: 4

Re: Over the last two years who made more investing in stock [#permalink] New post 19 Oct 2012, 09:02
I am gonna have to choose 'E'. Here's my reason:

1. For Lisa: its Total Returns/Total investment = Rtl/Itl = 0.2
For Kalley: its Total Returns/Total investment = Rtk/Itk = 0.05
Even though it is possible that Lisa might have invested more to get more returns, it is not always true. Kalley might have invested more than what Lisa did and her investments didnt do well. So 'A' is not an answer option.

2. Kalley "started" with twice as investments as Lisa's. We dont know yet what the total investments for these two people are. So 'B' isn't helping either.
So I chose answer 'E'. Thanks!
VP
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Status: I'm back and not stopping until I hit 760+
Joined: 06 Sep 2013
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Location: United States
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Schools: Wharton '17
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Re: Over the last two years who made more investing in stock [#permalink] New post 09 Dec 2013, 07:43
vijaygmat wrote:
Over the last two years who made more investing in stock market Lisa or Kalley.

(1) Lisa made an average (arithmetic mean) return 20 % while Kalley made an average (arithmetic mean) return of 5%
(2) Kalley started with two times as much money as Lisa

What is the strategy for solving these type of questions?


Obviously both statements alone are not sufficient

Now (1)+(2)

L made 20%, K made 5%
K invested more

Can we know who made more money?
NO

If K 100 and L 1 then K
If K 100 and L 99 then L

Hence E is the correct answer

Changed my mind buddy
Gimme Kuddos now!

Cheers!
J :)

Last edited by jlgdr on 29 Dec 2013, 09:12, edited 1 time in total.
Manager
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Joined: 21 Oct 2013
Posts: 105
Location: Germany
Concentration: Accounting, International Business
GPA: 3.91
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Kudos [?]: 9 [0], given: 14

Re: Over the last two years who made more investing in stock [#permalink] New post 12 Dec 2013, 03:38
jlgdr wrote:
vijaygmat wrote:
Over the last two years who made more investing in stock market Lisa or Kalley.

(1) Lisa made an average (arithmetic mean) return 20 % while Kalley made an average (arithmetic mean) return of 5%
(2) Kalley started with two times as much money as Lisa

What is the strategy for solving these type of questions?


Obviously both statements alone are not sufficient

Now (1)+(2)

1/5(2x)>1/20(x)

8x>x?

Well 'x' represents the amount of money so it has to be positive. Therefore IMO both statetements should be enough

Please advice because I suspect that there may be something wrong with the line of reasoning
Cheers
J :)


I did it just like you and chose C - which is wrong.

bumping for further explanation.
Intern
Intern
Status: Squeezing the last few ounces
Joined: 14 Feb 2013
Posts: 41
Location: United States (MI)
Concentration: General Management, Technology
GMAT Date: 04-24-2013
GPA: 3.5
WE: Information Technology (Computer Software)
Followers: 0

Kudos [?]: 17 [0], given: 13

Re: Over the last two years who made more investing in stock [#permalink] New post 12 Dec 2013, 12:39
unceldolan wrote:
jlgdr wrote:
vijaygmat wrote:
Over the last two years who made more investing in stock market Lisa or Kalley.

(1) Lisa made an average (arithmetic mean) return 20 % while Kalley made an average (arithmetic mean) return of 5%
(2) Kalley started with two times as much money as Lisa

What is the strategy for solving these type of questions?


Obviously both statements alone are not sufficient

Now (1)+(2)

1/5(2x)>1/20(x)

8x>x?

Well 'x' represents the amount of money so it has to be positive. Therefore IMO both statetements should be enough

Please advice because I suspect that there may be something wrong with the line of reasoning
Cheers
J :)


I did it just like you and chose C - which is wrong.

bumping for further explanation.


The 2nd statement says Kalley started with two times as much money as Lisa, the keyword here is started with. Now they may have started with 2x and x amounts respectively but they might invest more money during the course of 2 years in question.
So even taking (1) & (2) statements together doesn't answer the question.

Correct Ans: E
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Re: Over the last two years who made more investing in stock   [#permalink] 12 Dec 2013, 12:39
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