GMAT Question of the Day - Daily to your Mailbox; hard ones only

It is currently 15 Aug 2018, 00:02

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.

Close

Request Expert Reply

Confirm Cancel

An investment is made at 12.5% annual simple interest. The number of

  new topic post reply Question banks Downloads My Bookmarks Reviews Important topics  
Author Message
TAGS:

Hide Tags

Math Expert
User avatar
V
Joined: 02 Sep 2009
Posts: 47903
An investment is made at 12.5% annual simple interest. The number of  [#permalink]

Show Tags

New post 31 Jul 2018, 00:27
00:00
A
B
C
D
E

Difficulty:

  15% (low)

Question Stats:

78% (00:50) correct 22% (01:04) wrong based on 74 sessions

HideShow timer Statistics

An investment is made at 12.5% annual simple interest. The number of years it will take for the cumulative value of the interest to equal the original investment is equalt to which of the following?

(A) 4
(B) 5
(C) 6
(D) 7
(E) 8

_________________

New to the Math Forum?
Please read this: Ultimate GMAT Quantitative Megathread | All You Need for Quant | PLEASE READ AND FOLLOW: 12 Rules for Posting!!!

Resources:
GMAT Math Book | Triangles | Polygons | Coordinate Geometry | Factorials | Circles | Number Theory | Remainders; 8. Overlapping Sets | PDF of Math Book; 10. Remainders | GMAT Prep Software Analysis | SEVEN SAMURAI OF 2012 (BEST DISCUSSIONS) | Tricky questions from previous years.

Collection of Questions:
PS: 1. Tough and Tricky questions; 2. Hard questions; 3. Hard questions part 2; 4. Standard deviation; 5. Tough Problem Solving Questions With Solutions; 6. Probability and Combinations Questions With Solutions; 7 Tough and tricky exponents and roots questions; 8 12 Easy Pieces (or not?); 9 Bakers' Dozen; 10 Algebra set. ,11 Mixed Questions, 12 Fresh Meat

DS: 1. DS tough questions; 2. DS tough questions part 2; 3. DS tough questions part 3; 4. DS Standard deviation; 5. Inequalities; 6. 700+ GMAT Data Sufficiency Questions With Explanations; 7 Tough and tricky exponents and roots questions; 8 The Discreet Charm of the DS; 9 Devil's Dozen!!!; 10 Number Properties set., 11 New DS set.


What are GMAT Club Tests?
Extra-hard Quant Tests with Brilliant Analytics

Intern
Intern
avatar
B
Joined: 20 Mar 2018
Posts: 15
Location: India
Concentration: General Management, Operations
GPA: 3.8
WE: Operations (Manufacturing)
Re: An investment is made at 12.5% annual simple interest. The number of  [#permalink]

Show Tags

New post 31 Jul 2018, 00:44
Cumulative interest to be equal to original investment means the Investment to be double.
There is a shortcut formula for that.
Lets take n be the no of years to double the investment amount at an interest of r%
r = 72/n
by this formula we get n=5.76 so the 6 years will take to double the mount at 12.5% interest rate
The Correct answer is (C)
Director
Director
User avatar
G
Joined: 30 Jan 2015
Posts: 514
Location: India
Concentration: Operations, Marketing
GPA: 3.5
CAT Tests
Re: An investment is made at 12.5% annual simple interest. The number of  [#permalink]

Show Tags

New post 31 Jul 2018, 03:20
Bunuel wrote:
An investment is made at 12.5% annual simple interest. The number of years it will take for the cumulative value of the interest to equal the original investment is equalt to which of the following?


Simple Interest (I) = Principal (P) * Time (T) * Rate (R)
I = P * T * R

I = P (Given)

I = I * T * R
T * R = 1
T * 12.5/100 = 1
T = 100 / 12.5
T = 8 years

Hence, E.
_________________

The few, the fearless !

Thanks :-)

Board of Directors
User avatar
P
Status: QA & VA Forum Moderator
Joined: 11 Jun 2011
Posts: 3748
Location: India
GPA: 3.5
WE: Business Development (Commercial Banking)
GMAT ToolKit User Premium Member
Re: An investment is made at 12.5% annual simple interest. The number of  [#permalink]

Show Tags

New post 31 Jul 2018, 07:24
Bunuel wrote:
An investment is made at 12.5% annual simple interest. The number of years it will take for the cumulative value of the interest to equal the original investment is equalt to which of the following?

(A) 4
(B) 5
(C) 6
(D) 7
(E) 8

12.50*8 = 100

Thus, Answer must be (E)
_________________

Thanks and Regards

Abhishek....

PLEASE FOLLOW THE RULES FOR POSTING IN QA AND VA FORUM AND USE SEARCH FUNCTION BEFORE POSTING NEW QUESTIONS

How to use Search Function in GMAT Club | Rules for Posting in QA forum | Writing Mathematical Formulas |Rules for Posting in VA forum | Request Expert's Reply ( VA Forum Only )

Intern
Intern
avatar
B
Joined: 12 Mar 2018
Posts: 7
CAT Tests
Re: An investment is made at 12.5% annual simple interest. The number of  [#permalink]

Show Tags

New post 04 Aug 2018, 06:37
Quote:
Cumulative interest to be equal to original investment means the Investment to be double.
There is a shortcut formula for that.
Lets take n be the no of years to double the investment amount at an interest of r%
r = 72/n
by this formula we get n=5.76 so the 6 years will take to double the mount at 12.5% interest rate
The Correct answer is (C)



Hiren06 your logic of 72 rule is applicable for compound interests, and mind you this works only for low rates may be until 25%.... The above question asks for simple interest and the approach should be pnr/100 = p; and solve for n.
Intern
Intern
avatar
B
Joined: 03 Feb 2016
Posts: 11
Location: China
CAT Tests
Re: An investment is made at 12.5% annual simple interest. The number of  [#permalink]

Show Tags

New post 04 Aug 2018, 08:01
This is how i solved it:

S.I = P*R*T/100 = P*12.5*t/100
we have to find t when S.I = P
So t = S.I * 100/ 12.5*P = P*100/P*12.5 = 100/12.5 = 8

Answer = E
Intern
Intern
avatar
B
Joined: 20 Mar 2018
Posts: 15
Location: India
Concentration: General Management, Operations
GPA: 3.8
WE: Operations (Manufacturing)
Re: An investment is made at 12.5% annual simple interest. The number of  [#permalink]

Show Tags

New post 04 Aug 2018, 20:56
sriramsundaram91 wrote:
Quote:
Cumulative interest to be equal to original investment means the Investment to be double.
There is a shortcut formula for that.
Lets take n be the no of years to double the investment amount at an interest of r%
r = 72/n
by this formula we get n=5.76 so the 6 years will take to double the mount at 12.5% interest rate
The Correct answer is (C)



Hiren06 your logic of 72 rule is applicable for compound interests, and mind you this works only for low rates may be until 25%.... The above question asks for simple interest and the approach should be pnr/100 = p; and solve for n.


Thank you sriramsundaram91. It is really helpful.
Target Test Prep Representative
User avatar
G
Status: Founder & CEO
Affiliations: Target Test Prep
Joined: 14 Oct 2015
Posts: 3161
Location: United States (CA)
Re: An investment is made at 12.5% annual simple interest. The number of  [#permalink]

Show Tags

New post 10 Aug 2018, 19:10
Bunuel wrote:
An investment is made at 12.5% annual simple interest. The number of years it will take for the cumulative value of the interest to equal the original investment is equalt to which of the following?

(A) 4
(B) 5
(C) 6
(D) 7
(E) 8


We can assume the initial investment is $1000. Since the investment has a simple annual interest rate of 12.5%, in one year, the amount of interest accumulated is 1000 x 0.125 = $125. So it will take 1000/125 = 8 years to accumulate $1000 in interest.

Answer: E
_________________

Scott Woodbury-Stewart
Founder and CEO

GMAT Quant Self-Study Course
500+ lessons 3000+ practice problems 800+ HD solutions

Re: An investment is made at 12.5% annual simple interest. The number of &nbs [#permalink] 10 Aug 2018, 19:10
Display posts from previous: Sort by

An investment is made at 12.5% annual simple interest. The number of

  new topic post reply Question banks Downloads My Bookmarks Reviews Important topics  

Events & Promotions

PREV
NEXT


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

Powered by phpBB © phpBB Group | Emoji artwork provided by EmojiOne

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®.