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04 Jun 2020, 00:56
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C
Be sure to select an answer first to save it in the Error Log before revealing the correct answer (OA)!
Difficulty:
5%
(low)
Question Stats:
91% (02:09) correct
9%
(02:57)
wrong
based on 55
sessions
History
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Time
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Not Attempted Yet
James invested $100,000 in fund A at the beginning of 2012. The fund made losses during the year and he suffered a loss of 20 percent. At the beginning of 2013, he took his remaining money out of fund A and invested it in fund B. Fund B gave him an annual rate of 20 percent in 2013 and 10 percent in 2014. If he did not take out the interest earned from fund B in 2013, by what percent did his money grow from the beginning of 2012 to the end of 2014?
A. 1.9%
B. 3.3%
C. 5.6%
D. 10%
E. 11.2%
A. 1.9%
B. 3.3%
C. 5.6%
D. 10%
E. 11.2%
yashikaaggarwal
Senior Moderator - Masters Forum
Joined: 19 Jan 2020
Last visit: 29 Mar 2026
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Location: India
Schools: Cranfield (A) Warwick MiM "23 (M)
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WE:Analyst (Internet and New Media)
04 Jun 2020, 01:24
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You can solve this in two way.
Absolute percentage value change.
2012 = 20% loss (a)
2013 = 20% profit (b)
2014 = 10% profit (c)
Absolute percentage method = a+b+ab/100 = -20+20-20*20/100
=> -4 = k
Now k+c+k*c/100
=> -4+10-4*10/100
=> 6-0.4 = 5.6
Alternatively,
20% loss on 100,000 = 80,000 at the end of 2012
20% profit on 80,000 = 96,000 at the end of 2013
10% profit on 96,000 = 105,600
Change in the value = (new-old/old)*100
(105,600-100,000/100,000)*100
5600*100/100,000 = 5.6%
Answer is C
Posted from my mobile device
Absolute percentage value change.
2012 = 20% loss (a)
2013 = 20% profit (b)
2014 = 10% profit (c)
Absolute percentage method = a+b+ab/100 = -20+20-20*20/100
=> -4 = k
Now k+c+k*c/100
=> -4+10-4*10/100
=> 6-0.4 = 5.6
Alternatively,
20% loss on 100,000 = 80,000 at the end of 2012
20% profit on 80,000 = 96,000 at the end of 2013
10% profit on 96,000 = 105,600
Change in the value = (new-old/old)*100
(105,600-100,000/100,000)*100
5600*100/100,000 = 5.6%
Answer is C
Posted from my mobile device
04 Jun 2020, 02:16
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IMO C
I believe this problem can be solved using successive rate change and no need to consider the original Amount for calculation. Reason: After the loss, entire money in re-inverted, and after profit at the end of 2013, interest is not taken and re-invested.
Say A amount at the beginning of the year 2012
So it can be directly: A0.8 * 1.2 * 1.1)A = 1.056A = (1 + 5.6/100)A => 5.6% profit by end of 2014
P.S. This might help in DS questions
I believe this problem can be solved using successive rate change and no need to consider the original Amount for calculation. Reason: After the loss, entire money in re-inverted, and after profit at the end of 2013, interest is not taken and re-invested.
Say A amount at the beginning of the year 2012
So it can be directly: A0.8 * 1.2 * 1.1)A = 1.056A = (1 + 5.6/100)A => 5.6% profit by end of 2014
P.S. This might help in DS questions
