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07 Jun 2010, 02:39
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Question Stats:

0% (00:00) correct 100% (01:20) wrong based on 4 sessions

Q10:
$10,000 is deposited in a certain account that pays r percent annual interest compounded annually, the amount D(t), in dollars, that the deposit will grow to in t years is given by D(t) = 10,000 {1+(r/100)}t. What amount will the deposit grow to in 3 years? (1) D(t) = 11,000 (2) r =10 A. Statement (1) ALONE is sufficient, but statement (2) alone is not sufficient. B. Statement (2) ALONE is sufficient, but statement (1) alone is not sufficient. C. BOTH statements TOGETHER are sufficient, but NEITHER statement ALONE is sufficient. D. EACH statement ALONE is sufficient. E. Statements (1) and (2) TOGETHER are NOT sufficient. [Reveal] Spoiler: Answer:D _________________ Regards, Invincible... "The way to succeed is to double your error rate." "Most people who succeed in the face of seemingly impossible conditions are people who simply don't know how to quit." Manager Joined: 28 Feb 2010 Posts: 169 WE 1: 3 (Mining Operations) Re: Compound Interest. [#permalink] ### Show Tags 07 Jun 2010, 02:48 IMO B, because it directly gives the Rate of interest. However the OA is D, i.e A is also sufficient. My doubt is we already have a function of D(t) defined in terms of r and t. Option A gives and alternate function D(t) independent of any r or t. In that case, the function D(t) assumes 11,000 value for all values of t, and hence is sufficient to ans the question. But But But !!!! Please see that we are already given the function in the question step. Should we consider the funtion in the option as TRUE !!!.....in that case...it contradicts.... The point came in my mind during solving the question but I stood beside B.... _________________ Regards, Invincible... "The way to succeed is to double your error rate." "Most people who succeed in the face of seemingly impossible conditions are people who simply don't know how to quit." Intern Joined: 24 May 2010 Posts: 14 Re: Compound Interest. [#permalink] ### Show Tags 07 Jun 2010, 10:21 praveenism wrote: IMO B, because it directly gives the Rate of interest. However the OA is D, i.e A is also sufficient. My doubt is we already have a function of D(t) defined in terms of r and t. Option A gives and alternate function D(t) independent of any r or t. In that case, the function D(t) assumes 11,000 value for all values of t, and hence is sufficient to ans the question. But But But !!!! Please see that we are already given the function in the question step. Should we consider the funtion in the option as TRUE !!!.....in that case...it contradicts.... The point came in my mind during solving the question but I stood beside B.... I agree that the answer is B. Statement 2 is obviously sufficient as it gives the rate of interest. Statement 1 is not sufficient as it does not define t but tells us that the investment grew by 10%. This could mean that after the end of year 1, it grew by 10% which means that r is 10. However, it could also mean that at the end of year 2, the original investment is 11,000 which mean it grew at approximately 4.88% per year (used a calculator for this). So, this is clearly insufficient. Unless a part of the question is missing (i.e. r must be an integer or D(1) instead of D(t) in statement 1), statement 1 is not sufficient. Maybe I am missing something but that's my viewpoint. Re: Compound Interest. [#permalink] 07 Jun 2010, 10:21 Similar topics Replies Last post Similar Topics: 11 Ten years ago, Dorothy deposited a certain amount of money in account 4 25 Oct 2016, 13:48 José deposited a total of$ 10,000 into two interest-bearing accounts 7 30 Dec 2014, 21:01
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