Roger's hedge fund is taking x dollars and investing in bonds that

Dear robu,
I'm happy to respond.

I often say that it's relatively easy to write a high quality Quant question, and considerably harder to write a high quality Verbal question. Here, though, we have an atrocious Quant question.
1) The wording is abysmal and unclear. I would entirely rewrite this question to make clear what they are actually asking.
2) The scenario is patently absurd. No hedge fund on the face of the earth pays its clients simple interest. The sheer nonsense of that idea makes this question embarrassing. The GMAT would never do this! If it were up to me, I would rewrite in an entire different scenario, one in which linear growth, not exponential growth, would be expected.

The very job of the GMAT is to prepare folks for business school, and part of that includes testing students on their instincts for the push-and-pull of the business world: this happens all the time in GMAT CR questions, for example. In anything financial or business related, the GMAT is 100% realistic and grounded in what actually happens in the real business world. They would never have a problem in which a hedge fund is doing something very un-hedge-fund-like!!

Here's a question with the same variables and same answer choices that uses an appropriate scenario and is considerably clearer in its presentation:
Last summer, Roger worked x days at 2 hours/day at a job, and he was paid at a rate of r dollars per hour. For the whole summer, he earned $1000. This summer, he will work at another job that offers the same pay rate, r dollars per hour. This summer he will work H days at 5 hours/day, so that he will earn $4000 for the entire summer. In terms of x, which of the following equals H?
(A) x
(B) 2x/3
(C) 2x
(D) 4x/3
(E) 8x/5

If you found the first question confusing and can answer the second question, that is not your fault. It was the fault of the author of the first question.

Does all this make sense?
Mike