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

cyaniderGMAT · Answer

hey it mention in statement 2 that in 2002 chandler invested that amount . So how you take X to be that amount. Question is not clear that as it can be money which he got with interest in 2002 which he will be investing in future or something.
PLease clarify

Statement should be like in 2001 chandler invested this much amount

prepapr · Answer

The second statement in this DS question is somewhat confusing because it says:
 
It is unclear whether:
 
 Chandler originally invested that amount at the end of 2001 in the same certificate of deposit mentioned in the stem, or  
 Chandler made an additional investment during 2002.   
Since the question stem already states that both Monica and Chandler purchased the certificates at the end of 2001 and held them through the end of 2002, statement (2) would be clearer if it were phrased as:
 
or

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

Prep Toolkit

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