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Difficulty:
25%
(medium)
Question Stats:
76% (01:38) correct
24%
(01:18)
wrong
based on 54
sessions
History
Date
Time
Result
Not Attempted Yet
Carmen wants to open a special savings account through her work. If Carmen invests $7,000 at 6 percent simple annual interest in January, and no other money is added to or removed from the account, which of the following is true?
I. At the end of the year, Carmen will have earned $420 in interest.
II. At the end of six months, Carmen will have earned $35 in interest.
III. At the end of three months, Carmen will have $7,105 in the account.
A. I only
B. II only
C. III only
D. I and III only
E. I, II and III
_________________
I. At the end of the year, Carmen will have earned $420 in interest.
II. At the end of six months, Carmen will have earned $35 in interest.
III. At the end of three months, Carmen will have $7,105 in the account.
A. I only
B. II only
C. III only
D. I and III only
E. I, II and III
_________________
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nova31
Joined: 11 Jun 2019
Last visit: 04 Jul 2024
Posts: 13
Location: India
Concentration: Technology, Strategy
Schools: ISB '25 IIMB EPGP'25 (D) IIMA PGPX'25 Judge '25
GMAT 1: 730 Q49 V40
GPA: 3.4
WE:Engineering (Computer Software)
Bunuel
From stem :
Interest earned in 1 year = PRT/100 = 7000*6*1/100 = 420
Amount at end of 1 year = P + Interest in 1 year = 7000 + 420
I. At the end of the year, Carmen will have earned $420 in interest. CORRECT
II. At the end of six months, Carmen will have earned $35 in interest. In Simple Interest, unlike in compound interest, half-yearly interest = 1/2 of annual interest; 420/2 != 35 - INCORRECT
III. At the end of three months, Carmen will have $7,105 in the account. Interest earned in 3 months = 3/12 of annual interest = 420/4 = 105. Amount = P + I = 7105. CORRECT
OA - D. I and III only
I think if there's given that SI is calculating annually then it must calculated annually not in options if question would have stated that it's calculating quarterly then we should do it
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