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A family made a down payment of $75 and borrowed the balance

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A family made a down payment of $75 and borrowed the balance [#permalink] New post   11 Mar 2008, 18:41
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A family made a down payment of $75 and borrowed the balance on a set of encyclopedias that cost $400. The balance with interest was paid in 23 monthly payments of $16 each and a final payment of $9. The amount of interest paid was what percent of the amount borrowed?

(A) 6%
(B) 12%
(C) 14%
(D) 16%
(E) 20%
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D
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Re: A family made a down payment of $75 and borrowed the balance [#permalink] New post   18 Jul 2014, 17:59
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If it helps:

52/325 could be approximated to 16% by trying to make the denominator 100, 1000, 10000, etc.

So if you multiply by 3/3 you would get (52*3)/(325*3) = 156/975 which would be pretty close to 0.156 if we assume 975 = 1,000. That's a quick way to get the 16%.

Hope it helps!
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Re: A family made a down payment of $75 and borrowed the balance [#permalink] New post   Updated on: 11 Mar 2008, 22:15
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el1981 wrote:
A family made a down payment of $75 and borrowed the balance on a set of encyclopedias that cost $400. The balance with interest was paid in 23 monthly payments of $16 each and a final payment of $9. The amount of interest paid was what percent of the amount borrowed?(A) 6%(B) 12%(C) 14%(D) 16%(E) 20%

borrowings = 400-75 = 325

total pmt = 23x16 + 9 = 377
so int = 377 - 325 = 52
interest in terms of borrowing = 52/325 = 16%D.

Originally posted by GMAT TIGER on 11 Mar 2008, 20:49.
Last edited by GMAT TIGER on 11 Mar 2008, 22:15, edited 2 times in total.
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Re: A family made a down payment of $75 and borrowed the balance [#permalink] New post   11 Mar 2008, 20:57
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el1981 wrote:
A family made a down payment of $75 and borrowed the balance on a set of encyclopedias that cost $400. The balance with interest was paid in 23 monthly payments of $16 each and a final payment of $9. The amount of interest paid was what percent of the amount borrowed?
(A) 6%
(B) 12%
(C) 14%
(D) 16%
(E) 20%


I get D.

400 is total. they borrowed 400-75 or 325$.

23*16 + 9 = 377$

now 377-325=52.

52/325=.16 or 16%
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Re: A family made a down payment of $75 and borrowed the balance [#permalink] New post   11 Mar 2008, 21:49
GMAT TIGER wrote:
el1981 wrote:
A family made a down payment of $75 and borrowed the balance on a set of encyclopedias that cost $400. The balance with interest was paid in 23 monthly payments of $16 each and a final payment of $9. The amount of interest paid was what percent of the amount borrowed?
(A) 6%
(B) 12%
(C) 14%
(D) 16%
(E) 20%


borrowings = 400-75 = 325
total pmt = 23x16 + 9 = 397
so int = 397 - 325 = 72
interest in terms of borrowing = 72/325 = 20%

E.


The total amount is 377, not 397
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Re: A family made a down payment of $75 and borrowed the balance [#permalink] New post   24 Dec 2013, 11:56
el1981 wrote:
A family made a down payment of $75 and borrowed the balance on a set of encyclopedias that cost $400. The balance with interest was paid in 23 monthly payments of $16 each and a final payment of $9. The amount of interest paid was what percent of the amount borrowed?
(A) 6%
(B) 12%
(C) 14%
(D) 16%
(E) 20%


Should be pretty straightforward no?

They ask for Interest/Amount borrowed

Amount Borrowed is 325

Interest is 23*16 + 9 - 325 = 52

Therefore 52/326 = Approx 16%

Answer is (D)

Cheers!
J :)
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Re: A family made a down payment of $75 and borrowed the balance [#permalink] New post   18 Oct 2016, 11:06
Amount Borrowed = $325

Total Balance with interest paid = 23*$16 + $9 = 377

Interest = 377 - 325 = 52

Percentage: (52/325)*100 = 16%

Option D
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A family made a down payment of $75 and borrowed the balance [#permalink] New post   27 Dec 2018, 11:40
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el1981 wrote:
A family made a down payment of $75 and borrowed the balance on a set of encyclopedias that cost $400. The balance with interest was paid in 23 monthly payments of $16 each and a final payment of $9. The amount of interest paid was what percent of the amount borrowed?

(A) 6%
(B) 12%
(C) 14%
(D) 16%
(E) 20%


Total amount borrowed = 400 - 75 = 325.

Total amount paid = 23*16 + 9 = 377

interest paid = 377-325 = 52

So percentage = 52/325 * 100 = 52/13*4 = 4*4=16% D
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A family made a down payment of $75 and borrowed the balance [#permalink] New post   30 Jun 2022, 09:12
el1981 wrote:
A family made a down payment of $75 and borrowed the balance on a set of encyclopedias that cost $400. The balance with interest was paid in 23 monthly payments of $16 each and a final payment of $9. The amount of interest paid was what percent of the amount borrowed?

(A) 6%
(B) 12%
(C) 14%
(D) 16%
(E) 20%


Total price- $400,
Down payment- $75, Rest $325 - loan

Total loan payment including EMI- 23*16+9 = $377
Principal + Interest- $377 - $325= $52

Therefore percent = 52/325 = 16%
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A family made a down payment of $75 and borrowed the balance [#permalink] New post   Updated on: 08 Jun 2023, 06:30
chetan2u IanStewart
"set of encyclopedias that cost $400" seems to imply that the set of encyclopedias cost $400, off of which the balance was borrowed. So it seems to imply that the amount borrowed was 400.
I don't understand how people are able to interpret this statement as 400 - 75 = 325? Where does it say that?

Originally posted by 0Lucky0 on 07 Jun 2023, 23:56.
Last edited by 0Lucky0 on 08 Jun 2023, 06:30, edited 2 times in total.
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Re: A family made a down payment of $75 and borrowed the balance [#permalink] New post   08 Jun 2023, 00:11
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0Lucky0 wrote:
A family made a down payment of $75 and borrowed the balance on a set of encyclopedias that cost $400. The balance with interest was paid in 23 monthly payments of $16 each and a final payment of $9. The amount of interest paid was what percent of the amount borrowed?

(A) 6%
(B) 12%
(C) 14%
(D) 16%
(E) 20%

Bunuel, chetan2u
"set of encyclopedias that cost $400" seems to imply that the set of encyclopedias cost $400, off of which the balance was borrowed. So it seems to imply that the amount borrowed was 400.
I don't understand how people are able to interpret this statement as 400 - 75 = 325? Where does it say that?


A family made a down payment of $75 and borrowed the balance on a set of encyclopedias that cost $400, means the following:
  • The set of encyclopedias cost $400;
  • The family made a down payment of $75, so they paid $75.
  • The family borrowed the remaining amount, hence they borrowed $400 - $75 = $325.

The balance with interest was paid in 23 monthly payments of $16 each and a final payment of $9, means the following:
  • The borrowed sum of $325 was paid in 23 monthly payments of $16 each and a final payment of $9.
  • The payment was 23*16 + 9 = $377.
  • The interest was 377 - 325 = $52.

The amount of interest paid was 52/325 = (4*13)/(25*13) = 4/25 = 16/100 = 16%.

Answer: C.

Hope it helps.
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Re: A family made a down payment of $75 and borrowed the balance [#permalink] New post   08 Jun 2023, 01:25
Bunuel wrote:
0Lucky0 wrote:
A family made a down payment of $75 and borrowed the balance on a set of encyclopedias that cost $400. The balance with interest was paid in 23 monthly payments of $16 each and a final payment of $9. The amount of interest paid was what percent of the amount borrowed?

(A) 6%
(B) 12%
(C) 14%
(D) 16%
(E) 20%

Bunuel, chetan2u
"set of encyclopedias that cost $400" seems to imply that the set of encyclopedias cost $400, off of which the balance was borrowed. So it seems to imply that the amount borrowed was 400.
I don't understand how people are able to interpret this statement as 400 - 75 = 325? Where does it say that?


A family made a down payment of $75 and borrowed the balance on a set of encyclopedias that cost $400, means the following:
  • The set of encyclopedias cost $400;
  • The family made a down payment of $75, so they paid $75.
    So far so good. :)
  • The family borrowed the remaining amount, hence they borrowed $400 - $75 = $325.

Where does this "remaining amount" statement come from? from what I read, the family made a down payment of "75" and borrowed the rest off of 400$ worth of Encyclopedias so total 75+400 = 475 Total?
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Re: A family made a down payment of $75 and borrowed the balance [#permalink] New post   08 Jun 2023, 01:26
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0Lucky0 wrote:
Bunuel wrote:
0Lucky0 wrote:
A family made a down payment of $75 and borrowed the balance on a set of encyclopedias that cost $400. The balance with interest was paid in 23 monthly payments of $16 each and a final payment of $9. The amount of interest paid was what percent of the amount borrowed?

(A) 6%
(B) 12%
(C) 14%
(D) 16%
(E) 20%

Bunuel, chetan2u
"set of encyclopedias that cost $400" seems to imply that the set of encyclopedias cost $400, off of which the balance was borrowed. So it seems to imply that the amount borrowed was 400.
I don't understand how people are able to interpret this statement as 400 - 75 = 325? Where does it say that?


A family made a down payment of $75 and borrowed the balance on a set of encyclopedias that cost $400, means the following:
  • The set of encyclopedias cost $400;
  • The family made a down payment of $75, so they paid $75.
    So far so good. :)
  • The family borrowed the remaining amount, hence they borrowed $400 - $75 = $325.

Where does this "remaining amount" statement come from? from what I read, the family made a down payment of "75" and borrowed the rest off of 400$ worth of Encyclopedias so total 75+400 = 475 Total?


The question clearly says that the set of encyclopedias cost $400. So, your interpretation is not right.
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A family made a down payment of $75 and borrowed the balance [#permalink] New post   08 Jun 2023, 01:32
Bunuel wrote:
0Lucky0 wrote:
Bunuel wrote:
A family made a down payment of $75 and borrowed the balance on a set of encyclopedias that cost $400, means the following:
  • The set of encyclopedias cost $400;
  • The family made a down payment of $75, so they paid $75.
    So far so good. :)
  • The family borrowed the remaining amount, hence they borrowed $400 - $75 = $325.

Where does this "remaining amount" statement come from? from what I read, the family made a down payment of "75" and borrowed the rest off of 400$ worth of Encyclopedias so total 75+400 = 475 Total?


The question clearly says that the set of encyclopedias cost $400. So, your interpretation is not right.

Oh yea, I am not disputing that. That's what I am also saying, that the Encyclopedias cost 400$, But what I am having trouble understanding is where does it say that the down payment is to be subtracted from that 400? It says "borrowed the balance" which means after making a down payment of 75$, it borrowed 400$ more, so total payment is 475.
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Re: A family made a down payment of $75 and borrowed the balance [#permalink] New post   08 Jun 2023, 01:38
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0Lucky0 wrote:
Oh yea, I am not disputing that. That's what I am also saying, that the Encyclopedias cost 400$, But what I am having trouble understanding is where does it say that the down payment is to be subtracted from that 400? It says "borrowed the balance" which means after making a down payment of 75$, it borrowed 400$ more, so total payment is 475.


Your interpretation does not make sense. If the encyclopedias cost $400 and the family paid $75, why should they borrow $400? Sorry, that's all I have to say about this problem.
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Re: A family made a down payment of $75 and borrowed the balance [#permalink] New post   08 Jun 2023, 01:51
Bunuel wrote:
0Lucky0 wrote:
Oh yea, I am not disputing that. That's what I am also saying, that the Encyclopedias cost 400$, But what I am having trouble understanding is where does it say that the down payment is to be subtracted from that 400? It says "borrowed the balance" which means after making a down payment of 75$, it borrowed 400$ more, so total payment is 475.


Your interpretation does not make sense. If the encyclopedias cost $400 and the family paid $75, why should they borrow $400? Sorry, that's all I have to say about this problem.

Because 75 is down payment. A down payment is a small amount of money you put up when you buy a house and you pay the rest(much bigger amount) later on.
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Re: A family made a down payment of $75 and borrowed the balance [#permalink] New post   08 Jun 2023, 05:49
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0Lucky0 wrote:
chetan2u KarishmaB
"set of encyclopedias that cost $400" seems to imply that the set of encyclopedias cost $400, off of which the balance was borrowed. So it seems to imply that the amount borrowed was 400.
I don't understand how people are able to interpret this statement as 400 - 75 = 325? Where does it say that?


"the balance was borrowed" means "the remaining was borrowed"
"balance" means what is left in this context. I borrowed $100 from you and later returned $40 say. If I ask you, "What is my balance?" it means how much is remaining? How much more do I have to give you.

"A family made a down payment of $75 and borrowed the balance on a set of encyclopedias that cost $400"
means they paid $75 right away and then borrowed the remaining $325 from some and paid to get the set.
To this someone, then they made monthly payments.
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A family made a down payment of $75 and borrowed the balance [#permalink] New post   08 Jun 2023, 06:21
KarishmaB wrote:
0Lucky0 wrote:
chetan2u KarishmaB
"set of encyclopedias that cost $400" seems to imply that the set of encyclopedias cost $400, off of which the balance was borrowed. So it seems to imply that the amount borrowed was 400.
I don't understand how people are able to interpret this statement as 400 - 75 = 325? Where does it say that?


"the balance was borrowed" means "the remaining was borrowed"
"balance" means what is left in this context. I borrowed $100 from you and later returned $40 say. If I ask you, "What is my balance?" it means how much is remaining? How much more do I have to give you.
So far so good. Completely makes sense.
"A family made a down payment of $75 and borrowed the balance on a set of encyclopedias that cost $400"
means they paid $75 right away and then borrowed the remaining $325 from some and paid to get the set.
To this someone, then they made monthly payments.


"remaining $325"? How do you deduce that it means "remaining $325" ?

It says "Borrowed the balance" on a set of encyclopedias that cost $400" ==> Translation ==> "Borrowed the amount left after making a down payment of 75$. So whatever amount that was left after paying 75$,
Now what is this amount that was left? ==> "on a set of encyclopedias that cost $400", meaning the encyclopedias cost 400$ and so 400$ was borrowed but since this 400$ is the balance amount after making a down payment of 75$ so 75 + 400 = 475$ is the total amount to be paid.
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A family made a down payment of $75 and borrowed the balance [#permalink] New post   08 Jun 2023, 06:33
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0Lucky0 wrote:
KarishmaB wrote:
0Lucky0 wrote:
chetan2u KarishmaB
"set of encyclopedias that cost $400" seems to imply that the set of encyclopedias cost $400, off of which the balance was borrowed. So it seems to imply that the amount borrowed was 400.
I don't understand how people are able to interpret this statement as 400 - 75 = 325? Where does it say that?


"the balance was borrowed" means "the remaining was borrowed"
"balance" means what is left in this context. I borrowed $100 from you and later returned $40 say. If I ask you, "What is my balance?" it means how much is remaining? How much more do I have to give you.
So far so good. Completely makes sense.
"A family made a down payment of $75 and borrowed the balance on a set of encyclopedias that cost $400"
means they paid $75 right away and then borrowed the remaining $325 from some and paid to get the set.
To this someone, then they made monthly payments.


"remaining $325"? How do you deduce that it means "remaining $325" ?

It says "Borrowed the balance" on a set of encyclopedias that cost $400" ==> Translation ==> "Borrowed the amount left after making a down payment of 75$. So whatever amount that was left after paying 75$,
Now what is this amount that was left? ==> "on a set of encyclopedias that cost $400", meaning the encyclopedias cost 400$ and so 400$ was borrowed but since this 400$ is the balance amount after making a down payment of 75$ so 75 + 400 = 475$ is the total amount to be paid.


A word means many different things depending on context. That is why we say 'reading newspapers, magazines etc.' is important.
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Re: A family made a down payment of $75 and borrowed the balance [#permalink] New post   08 Jun 2023, 06:49
KarishmaB wrote:
0Lucky0 wrote:
KarishmaB wrote:
"the balance was borrowed" means "the remaining was borrowed"
"balance" means what is left in this context. I borrowed $100 from you and later returned $40 say. If I ask you, "What is my balance?" it means how much is remaining? How much more do I have to give you.
So far so good. Completely makes sense.
"A family made a down payment of $75 and borrowed the balance on a set of encyclopedias that cost $400"
means they paid $75 right away and then borrowed the remaining $325 from some and paid to get the set.
To this someone, then they made monthly payments.


"remaining $325"? How do you deduce that it means "remaining $325" ?

It says "Borrowed the balance" on a set of encyclopedias that cost $400" ==> Translation ==> "Borrowed the amount left after making a down payment of 75$. So whatever amount that was left after paying 75$,
Now what is this amount that was left? ==> "on a set of encyclopedias that cost $400", meaning the encyclopedias cost 400$ and so 400$ was borrowed but since this 400$ is the balance amount after making a down payment of 75$ so 75 + 400 = 475$ is the total amount to be paid.


A word means many different things depending on context. That is why we say 'reading newspapers, magazines etc.' is important.

I agree completely and I still stand by my point, I completely agree with you that the word "balance" means "remaining" but where we don't agree is if 400$ is what is remaining or if 400$ after deducting 75$ is what is remaining. From the statement, it clearly says that "remaining is 400", whereas you seem to imply that remaining is "400-75".
The statement in the question can be restated as "balance is 400$". Not sure how a statement this clear can be interpreted as "balance is 400 - downpayment".
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Re: A family made a down payment of $75 and borrowed the balance [#permalink]
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