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A
Be sure to select an answer first to save it in the Error Log before revealing the correct answer (OA)!
Difficulty:
35%
(medium)
Question Stats:
67% (00:49) correct
33%
(01:25)
wrong
based on 72
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$30,000 were invested into an index fund on January 1, 2010. During what year did the value of this fund exceed $40,000?
(1) The investment rose in value by 10 percent each year.
(2) On January 1, 2015, the value of the investment was $48,315.3
(1) The investment rose in value by 10 percent each year.
(2) On January 1, 2015, the value of the investment was $48,315.3
01 Jan 2026, 10:15
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ExpertsGlobal5
$30,000 was invested into a fund.
We need to find when the funds exceeded $40,000.
Statement 1:
The investment rose in value by 10 percent each year.
30000 with a 10% increase = 30000+ 3000 = 33000.
33000 with a 10% increase = 33000+ 3300 = 36300.
36300 with a 10% increase = 36300 + 3630 = 39930.
so the next year the value exceeds 40,000. So, Jan 1,2014 the value exceeds the mark.
Hence, Sufficient.
Statement 2:
On January 1, 2015, the value of the investment was $48,315.3
This statement mentions the futuristic value of the investment.
But, even though the value has surpassed the $40,000 mark.
The increase can be constant addition to the total, by a fixed percent, or coumpounded rates or any doubling and halving conditions.
Hence, Insufficient
Option A
04 Jan 2026, 18:15
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ExpertsGlobal5
Explanation:
On January 1, 2010 fund value = $30000.
We need to find whether the year at which the fund value exceeds 40,000 can be determined.
Statement (1)
If the investment rose in value by 10 percent each year:
Fund value at year 2010 = 30000
Fund value at year 2011 = 30000 x (1.1)
Fund value at year 2012 = 30000 x (1.1) x (1.1)
Fund value at year (2010 + n) = 30000 x (1.1)[sup]n[/sup]
We have to find the year at which the fund value exceeds 40000, which can also be expressed as:
Find the value of n for which 30000 x (1.1)[sup]n [/sup]> 40000, and then add 2010 to that value.
Since it is possible to find a unique value for n that satisfies this condition, it is also possible to determine the exact year at which the fund value exceeds $40,000. Hence, Statement (1) is sufficient.
Statement (2)
On January 1, 2015 fund value = $48,315.3.
Since no information regarding the growth rate of the fund value is provided, it is NOT possible to determine the exact year at which the fund value exceeds $40,000. Hence, Statement (2) is insufficient.
A is the correct answer choice
