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05 Jun 2010, 07:25
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C
Be sure to select an answer first to save it in the Error Log before revealing the correct answer (OA)!
Difficulty:
25%
(medium)
Question Stats:
79% (01:26) correct
21%
(01:13)
wrong
based on 33
sessions
History
Date
Time
Result
Not Attempted Yet
After a period of 3 years, how much greater is the interest income on $5,000 invested in investment A, which yields X percent interest compounded annually, than on the same amount invested in investment B, which yields Y percent simple annual interest?
(1) After 1 year, the interest income from investment A is $500.
(2) After 3 years, the interest income from investment B is $1,500.
(1) After 1 year, the interest income from investment A is $500.
(2) After 3 years, the interest income from investment B is $1,500.
I marked A.
Stmt 1 gives us the Interest rate for CI for 1st year which is same as SI for the first year.
Since the amount invested and number of years is given we can hence find out the Total interest earned on thru CI and SI and find the difference between the two interest amounts.
But in the explanation it says Stmt 1 does not gives any information for Interest rate of B.
Please tell me where I am going wrong.
Stmt 1 gives us the Interest rate for CI for 1st year which is same as SI for the first year.
Since the amount invested and number of years is given we can hence find out the Total interest earned on thru CI and SI and find the difference between the two interest amounts.
But in the explanation it says Stmt 1 does not gives any information for Interest rate of B.
Please tell me where I am going wrong.
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06 Jun 2010, 00:41
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Ans C.
The question a is asking for the difference in interest earned on investment A and B.
St-1 will provide total interest earned on investment A
St-2 will provide total interest earned on investment B
So we have to combine St-1 and St-2 for getting the difference.Hence C
The question a is asking for the difference in interest earned on investment A and B.
St-1 will provide total interest earned on investment A
St-2 will provide total interest earned on investment B
So we have to combine St-1 and St-2 for getting the difference.Hence C
06 Jun 2010, 01:13
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We must know value of X and Y to answer the question.
Statement one helps to find X.
Statement two helps to find Y.
So both of the statements are required to answer the question.
Answer is C
Statement one helps to find X.
Statement two helps to find Y.
So both of the statements are required to answer the question.
Answer is C
