At the end of the year 2001, Monica and Chandler each purchased a cert

Question

At the end of the year 2001, Monica and Chandler each purchased a certificate of deposit that paid the same rate of interest, and each held the certificate of deposit through the end of 2002. If Chandler invested X dollars and Monica invested $130,000, and if Chandler earned interest in 2002 totaling $45,000, what was the amount of interest that Monica earned on her $130,000 investment?

(1) The rate of interest on the certificate of deposit that Chandler and Monica each purchased was 8.5% annually.
(2) In 2002, Chandler invested $529,412 in the certificate of deposit.

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MaitriD · Answer

Given that both C and M have same interest rate, say 'i %'
I = P*R*T

C invested $X for 1 tear at i % 
X*i %*1 = $45,000

M invested $130,000 for 1 year at i %

130,000 * i% * 1 = Y

To find: amount of interest paid by Monica ie. Y

Statement 1:  The rate of interest on the certificate of deposit that Chandler and Monica each purchased was 8.5% annually.

i % = 8.5%

We can apply this to Monica's equation and get the value of interest paid by her 
130,000 * 8.5% = Y

Sufficient

Statement 2:  In 2002, Chandler invested $529,412 in the certificate of deposit

X = $529,412
529,412 *i %*1 = $45,000

from this we can solve for the interest rate which can be inputted in Monica's equation to get the interest

Sufficient

each statement alone is sufficient

Dereno · Answer

Two people , Monica and Chandler each purchased a certificate of deposit that had the same interest rate.

The amount invested by Monica is $130,000.

The amount invested by Chandler is $X.

The interest earned by Chandler was $45,000. We need to find the Interest earned by Monica.

How can we find the interest earned by Monica ? Either the interest rates should be given OR If we know the amount invested by Chandler $X, then at both cases we can get the answer.

Statement 1:

(1) The rate of interest on the certificate of deposit that Chandler and Monica each purchased was 8.5% annually.

The interest rate is given, so using the formula

Interest earned = Investment * rate of interest * tenure

= 130000 * 8.5% * 1

Hence,  Sufficient

Statement 2:

(2) In 2002, Chandler invested $529,412 in the certificate of deposit.

If the amount invested by Chandler is $X = $529,412

$529,412 * rate of interest * 1 = $45000

solving, we ge the rate of interest to be 8.5%.

This interest rate can be used to find the interest amount earned by Monica.

Hence,  Sufficient

Option D

bruhletmein · Answer

A simple and fun one as a FRIENDS fan.

Bit of a text heavy stem, but breaking it down, we realise that if we let the rate = r, the question really just boils down to the value of r. If we find this, the statement is sufficient

(1) straight up gives us r = 8.5% ->  SUFFICIENT

(2) We can calculate r. Ms. Chanandler Bong has received interest X * (r/100) = 45,000

X is his initial investment, so we can calculate r, and apply this r to Monica's investment as both receive the same rate ->  SUFFICIENT

D

MS26 · Answer

Since the question stem doesn’t mentions whether the interest rate is simple or compound , shouldn’t the answer be B here instead of D 
 Bunuel  could you pls clarify my doubt

Bunuel · Answer

Since it's one year, simple or compound interest doesn't matter.

MS26 · Answer

Understood thanks

At the end of the year 2001, Monica and Chandler each purchased a cert

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GMAT Data Sufficiency (DS) Questions

At the end of the year 2001, Monica and Chandler each purchased a cert

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