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29 Oct 2018, 06:15
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Difficulty:

45% (medium)

Question Stats:

70% (02:20) correct 30% (02:20) wrong based on 91 sessions

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An investment yields an interest payment of $68 each week. If the simple annual interest rate is 7.5%, what is the amount of the investment assuming there only 48 weeks are calculated in a year? A.$28,600
B. $30,430 C.$34,330
D. $37,860 E.$43,520

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An investment yields an interest payment of $68 each week. If the simp [#permalink] ### Show Tags 29 Oct 2018, 07:20 Bunuel wrote: An investment yields an interest payment of$68 each week. If the simple annual interest rate is 7.5%, what is the amount of the investment assuming there only 48 weeks are calculated in a year?

A. $28,600 B.$30,430
C. $34,330 D.$37,860
E. $43,520 Total Interest per year is $$68*48$$ Now, $$68*48 = \frac{P*1*7.5}{100}$$ So, $$p = 43,520$$, 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 ) e-GMAT Representative Joined: 04 Jan 2015 Posts: 3250 Re: An investment yields an interest payment of$68 each week. If the simp  [#permalink]

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30 Oct 2018, 02:41

Solution

Given:
• Interest payment for each week = $68 • Simple annual interest rate = 7.5% • Number of weeks calculated in a year = 48 To find: • The amount of investment Approach and Working: • Let us assume that the investment amount = A • Interest rate per week = 7.5%/total number of weeks in that year = $$\frac{7.5%}{48}$$ • Interest payment for each week =$68
• Thus, $$(\frac{7.5}{48})$$% of A = $68 o Implies, A = $$\frac{(68 * 48 *100)}{7.5} = 43,520$$ Hence, the correct answer is Option E Answer: E _________________ Intern Joined: 17 Aug 2019 Posts: 7 Location: Singapore Concentration: Finance, General Management GMAT 1: 620 Q46 V30 WE: Analyst (Commercial Banking) Re: An investment yields an interest payment of$68 each week. If the simp  [#permalink]

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03 Jan 2020, 21:20
1
We can estimate $68 * 48 as$70 *50 = $3,500 So approx. 7% =$3,500
100% = $50,000 Nearest answer is Option E :$43,520
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06 Jan 2020, 06:39
Huihui89 wrote:
Hi,

at first I thought one has to calculate the total investment resulting from compounding the interest rate 48 times. This is not the case unless compound interest is explicitly mentioned, am I wrong? Thanks

Try this way -

Total Interest is 48 x 68 = 3264

Interest is 7.5 when principal is 100

So, Interest is 15 when principal is 100/7.5

Or, Interest is 3264 when principal is $$\frac{100}{7.5}*3264 = 43520$$
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PLEASE FOLLOW THE RULES FOR POSTING IN QA AND VA FORUM AND USE SEARCH FUNCTION BEFORE POSTING NEW QUESTIONS

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