M08-34

Question

Jules and Jim both invested a certain amount of money in bond M for one year, which pays for 12% simple interest annually. If no other investment was made, then Jules initial investment in bond M was how many dollars more than Jim's investment in bond M ?

(1) In one year Jules earned $24 more than Jim from bond M.
 
(2) If the interest were 20% then in one year Jules would have earned $40 more than Jim from bond M.

Bunuel · Accepted Answer

Official Solution:

Jules and Jim both invested a certain amount of money in bond M for one year, which pays for 12% simple interest annually. If no other investment was made, then Jules initial investment in bond M was how many dollars more than Jim's investment in bond M ? 
 
Assume Jules invested  $ x  and Jim invested  $ y .
 
The question asks to find the value of  x-y .
 
(1) In one year Jules earned $24 more than Jim from bond M. 
 
The above implies that  0.12x-0.12y=24 . When divided by 0.12, we get  x-y=200 . Sufficient.
 
(2) If the interest were 20% then in one year Jules would have earned $40 more than Jim from bond M. 
 
This is essentially the same type of information as above:  0.2x-0.2y=40 . When divided by 0.2, we get  x-y=200 . Sufficient.
 
 Crucial note : When two amounts are increased (decreased) by the same percentage, their difference also increases (decreases) by that same percentage. For instance, if you increase 100 and 150 by 20% to 120 and 180 respectively, then their difference will also increase by the same 20% from 50 to 60.

Answer: D

tae808 · Answer

I think this is a  high-quality  question and I agree with explanation.

Munch · Answer

I think this is a  high-quality  question and I agree with explanation.

mtk10 · Answer

Hi Bunnel 
Could you post similar questions to this
and if you could also post theory related to this. It would be very helpful

Regards

Bunuel · Answer

4. Percents and Iterest 
     Theory   
 Math: Number Theory - Percents 
 Percentages, Interest and More 
     Questions   
 Compound Interest Problems 
 DS Questions 
 PS Questions

For more check:
 ALL YOU NEED FOR QUANT ! ! ! 
 Ultimate GMAT Quantitative Megathread

Hope it helps.

RahulS90 · Answer

While the option D is correct, I think there is a slight error in your interpretation of option B

You have written 0.2x - 0.2 y = 40

This is wrong because the question says "40 more" and not "just 40"

Hence
0.2x - 0.4 y = 40 + (0.12x - 0.12y)

0.08 x - 0.08 y = 40
Hence x - y = 500 and not 200

Please let me know if I am wrong

Bunuel · Answer

Yes, you are wrong.

(2) If the interest were 20% then in one year Jules would have earned $40 more than Jim from bond M.

If the interest were 20% then in one year Jules would have earned 0.2x
If the interest were 20% then in one year Jules would have earned 0.2y

Jules would have earned $40 more than Jim, so 0.2x = 0.2y + 40, which is the same as 0.2x - 0.2y = 40.

RenanBragion · Answer

I think this is a  high-quality  question and I agree with explanation.

davidbeckham · Answer

Hi  Bunuel , if in the second option it was given that the 20% increase is over two years then would we have multiplied the same equation with two? If not, how should we solve that?

Bunuel · Answer

If (2) were  If the interest were 20% (instead of 12%) then in two years Jules would have earned $40 more than Jim from bond M , then we'd have:  (1.2^2x -x) - (1.2^2y - y) = 40  (interest earned = final sum - investment = 1.2*1.2*x - x).

Bunuel · Answer

I have edited the question and the solution by adding more details to enhance its clarity. I hope it is now easier to understand.

BottomJee · Answer

I think this is a  high-quality  question and I agree with explanation.

fabp · Answer

Jules and Jim both invested a certain amount of money in bond M for one year, which pays for 12% simple interest annually. If no other investment was made, then Jules initial investment in bond M was how many dollars more than Jim's investment in bond M ?

(1) In one year Jules earned $24 more than Jim from bond M.

(2) If the interest were 20% then in one year Jules would have earned $40 more than Jim from bond M.

This is what I see.
I dont see options for the answer, yet the answer is option d?? What am I missing?

Bunuel · Answer

Hi,

This is a data sufficiency question. Options for DS questions are always the same and usually omitted on the site.

The data sufficiency problem consists of a question and two statements, labeled (1) and (2), in which certain data are given. You have to decide whether the data given in the statements are sufficient for answering the question. Using the data given in the statements, plus your knowledge of mathematics and everyday facts (such as the number of days in July or the meaning of the word counterclockwise), you must indicate whether—

A. Statement (1) ALONE is sufficient, but statement (2) alone is not sufficient to answer the question asked.
B. Statement (2) ALONE is sufficient, but statement (1) alone is not sufficient to answer the question asked.
C. BOTH statements (1) and (2) TOGETHER are sufficient to answer the question asked, but NEITHER statement ALONE is sufficient to answer the question asked.
D. EACH statement ALONE is sufficient to answer the question asked.
E. Statements (1) and (2) TOGETHER are NOT sufficient to answer the question asked, and additional data specific to the problem are needed.

I suggest you to go through the following post  ALL YOU NEED FOR QUANT .

Hope this helps.

sssdd1234 · Answer

I think this is a  high-quality  question and I agree with explanation.

Kandy11 · Answer

what are the options....cant see them.

Bunuel · Answer

Hi,

This is a data sufficiency question. Options for DS questions are always the same and usually omitted on the site.

The data sufficiency problem consists of a question and two statements, labeled (1) and (2), in which certain data are given. You have to decide whether the data given in the statements are sufficient for answering the question. Using the data given in the statements, plus your knowledge of mathematics and everyday facts (such as the number of days in July or the meaning of the word counterclockwise), you must indicate whether—

A. Statement (1) ALONE is sufficient, but statement (2) alone is not sufficient to answer the question asked.
B. Statement (2) ALONE is sufficient, but statement (1) alone is not sufficient to answer the question asked.
C. BOTH statements (1) and (2) TOGETHER are sufficient to answer the question asked, but NEITHER statement ALONE is sufficient to answer the question asked.
D. EACH statement ALONE is sufficient to answer the question asked.
E. Statements (1) and (2) TOGETHER are NOT sufficient to answer the question asked, and additional data specific to the problem are needed.

Hope this helps.

Kandy11 · Answer

Thanks a lot.
I mean the ANSWER options are not given. A, B, C or D....I have solved it but I don't know which option to select.

Bunuel · Answer

Here are the answer options for ALL DS questions:

A. Statement (1) ALONE is sufficient, but statement (2) alone is not sufficient to answer the question asked. 
 B. Statement (2) ALONE is sufficient, but statement (1) alone is not sufficient to answer the question asked. 
 C. BOTH statements (1) and (2) TOGETHER are sufficient to answer the question asked, but NEITHER statement ALONE is sufficient to answer the question asked. 
 D. EACH statement ALONE is sufficient to answer the question asked. 
 E. Statements (1) and (2) TOGETHER are NOT sufficient to answer the question asked, and additional data specific to the problem are needed.

M08-34

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