If x dollars is invested at 10 percent for one year and y

Question

If x dollars is invested at 10 percent for one year and y dollars is invested at 8 percent for one year, the annual income from the 10 percent investment will exceed the annual income from the 8 percent investment by $56. If $2,000 is the total amount invested, how much is invested at 8 percent?

(A) $280 (B) $800 (C) $892 (D) $1,108 (E) $1,200

y = 2000 - x

.1x - .08(2000-x) = 56

.-160+.18x = 56

x = 1200 and y = 800

my answer is B

(A) $280 
(B) $800 
(C) $892 
(D) $1,108 
(E) $1,200

EMPOWERgmatRichC · Accepted Answer

Hi All,

While this is an old prompt, it can be solved by TESTing THE ANSWERS.

We're given a number of facts to work with:
1) $2,000 is invested in 2 different accounts.
2) The accounts pay 10% and 8% annual interest (calculated annually, for lack of any additional info)
3) After 1 year, the 10% account will generate $56 MORE than the 8% account.

We're asked for the amount of money invested in the 8% account.

To start, we can do a simple, hypothetical calculation. If we invested $1,000 in each account....
10% of $1,000 = $100
8% of $1,000 = $80
....then the difference would be $20. This is TOO SMALL (it's supposed to be $56), thus MORE than $1,000 is invested at 10% and LESS is invested at 8%. Eliminate Answers D and E.

Among the 3 remaining Answers, let's TEST Answer B: $800

IF....$800 is invested in the 8% account....
10% of $1200 = $120
8% of $800 = $64
...then the difference would be $56, which is an exact MATCH for what we were told. So this MUST be the answer.

Final Answer:  B

GMAT assassins aren't born, they're made,
Rich

chetan2u · Answer

Aditya two ways ..
1) 8% would require at least two 0s to ensure that the difference is an integer 
Otherwise say amount is 780...8% will result in a decimal
So answer will be 800, 1000 or 1200..
If it is 1000 each.. difference is 100 for 10% and 80 for 8%, so 100-80=20
But we want 56>20
So if you want to increase the difference, the greater should increase and smaller decrease, so only possible value 800

Otherwise 
1) 56 has a units digit of 6 which is 10-4..
So 8*z should have units digit as 4.. 8*800 /100 will give 4 as units digit

yezz · Answer

If x dollars is invested at 10 percent for one year and y dollars is invested at 8 percent for one year, the annual income from the 10 percent investment will exceed the annual income from the 8 percent investment by $56. If $2,000 is the total amount invested, how much is invested at 8 percent? 

(A) $280 (B) $800 (C) $892 (D) $1,108 (E) $1,200

y = 2000 - x


.1x - .08(2000-x) = 56

 .-160+.18x = 56

x = 1200 and y = 800

my answer is B

lfox2 · Answer

If x dollars is invested at 10 percent for one year and y dollars is invested at 8 percent for one year, the annual income from the 10 percent investment will exceed the annual income from the 8 percent investment by $56. If $2,000 is the total amount invested, how much is invested at 8 percent? 

(A) $280 
(B) $800 
(C) $892 
(D) $1,108 
(E) $1,200

2% = 56
1% = 28
10% = 280
100% 2800

0.10x - 0.8y = 56
X + y = 2000
X = 2000 - Y

0.10 (2000 â€“ Y ) â€“ 0.8Y = 56

200 â€“ 0.10Y â€“ 0.8Y = 56

-0.18Y = -144

Y = 800

agdimple333 · Answer

2 equations with 2 unknowns

10x / 100 - 8y / 100 = 56

and

x + y = 2000

Solving these 2 equations, x = 1200 and y = 800

Answer B.

amit2k9 · Answer

annual income = principal + interest

for x @ 10% x + 10/100 * x = 1.1 x
for y @ 8% y + 8/100 * y = 1.08y

x+y = 2000

1.1x - 1.08y = 56
1.1 (2000-y) - 1.08y = 56 
2200-1.1y-1.08y = 56
2.08y = 2144

y= 2144/2.18 = 983.46

so the question stem must say the annual interest difference rather than annual income difference.

JeffTargetTestPrep · Answer

We are given that x = the number of dollars invested at 10% and y = the number of dollars invested at 8%. We are also given that the total amount invested is $2000, and thus we have x + y = 2000 or x = 2000 - y. Finally, we are given that the annual income from the 10% investment exceeds the annual income from the 8% investment by $56, so we can create the following equation to determine the value of y:
 
0.10x = 0.08y + 56
 
0.10(2000 - y) = 0.08y + 56
 
200 - 0.10y = 0.08y + 56
 
144 = 0.18y
 
14400 = 18y
 
y = 14400/18 = 800
 
Answer: B

AdityaHongunti · Answer

everyone above has mentioned the conventional method. Which almost takes 2 mins. if anyone could suggest an approach for easy POE.  Bunuel   chetan2u   sayantanc2k

Pankaj0901 · Answer

Agreed. Can someone please explain this? Thanks

EMPOWERgmatRichC · Answer

Hi Pankaj0901,

The principal amount invested in an account is NOT income, so the short answer is that amit2k9's interpretation of the prompt is not correct. The income in this case is any 'new' money that is placed into the account from the interest that is generated on that account. If you wanted to approach this Algebraically, then you could create the following 2 equations (and then solve via Substitution or Combination):

X + Y = 2000
.1X - .08Y = 56

As an alternative, you would likely find TESTing THE ANSWERS to be a lot faster.
 
GMAT assassins aren't born, they're made,
Rich

Pankaj0901 · Answer

Thank you  EMPOWERgmatRichC 
Your first statement clarifies my doubt -  The principal amount invested in an account is NOT income.

naveeng15 · Answer

y = 2000 - x

.1x - .08(2000-x) = 56

.-160+.18x = 56

x = 1200 and y = 800

Posted from my mobile device

Nsp10 · Answer

Why it is 0.10x = 0.08y + 56
and not 
1.1x-1.08y=56 ??
kindly Help

EMPOWERgmatRichC · Answer

Hi Nsp10, The principal amount invested in an account is NOT income, so that interpretation of the prompt is not correct. The income in this case is any 'new' money that is placed into the account from the INTEREST that is generated on that account. If you wanted to approach this Algebraically, then you could create the following 2 equations (and then solve via Substitution or Combination): X + Y = 2000 .1X - .08Y = 56 As an alternative, you would likely find TESTing THE ANSWERS to be a lot faster. GMAT assassins aren't born, they're made, Rich Contact Rich at: Rich.C@empowergmat.com www.empowergmat.com

Nsp10 · Answer

Thank you EMPOWERgmatRichC.

anirchat · Answer

Please do not use algebra to solve this. This will just make you wate your time. Try using option elimination.

One such method is described below.

Lete me assume these are equally distributed , 100 $ each. The the interests would be 80 $ and 100 $ respectively, for x and y and x is 20 more than y.
Now the target difference is 56 $, which means that x > 1000 or y < 1000 for sure, so options D and E are eliminated. Also we can guess that A is too small a number considering 50/50 split gave us 20$ already so A is gone too.

Now just substituting the easier of the two remaining options which is 800 (B), we see that the diff is 120- 64 =56.

TADA !!
So B is the solution.

This way you can solve in less than 2 minutes.

Always remember, as Charles says :

Every question in GMAT quant can be solved in 2 mins.
It is not math, it is quantitative reasoning
Have I seen every possible solution path ?
Have I found the best possible solution path ?
Have I invested enough time in the begining to find the best possibe solution path ?

hemanthPA · Answer

Given

2000 = x + y..............equ 1
56 = 0.1x - 0.08y.............equ 2

multipy equ 1 with 0.1, you get 200 = 0.1x + 0.1y

subtract equ 1 by 2, you get

0.1x + 0.1y = 200
0.1x - 0.08y = 56
________________
 0.18y = 144

y = 144/0.18 = 144*100/18 = 8*100 = 800

bumpbot · Answer

Automated notice from GMAT Club BumpBot: 

A member just gave Kudos to this thread, showing it’s still useful. I’ve bumped it to the top so more people can benefit. Feel free to add your own questions or solutions.

 This post was generated automatically.

If x dollars is invested at 10 percent for one year and y

Prep Toolkit

Top 5 GMAT Debrief Videos

615 to 715 in 15 Days (Ria's Strategies)

More than Quant/Verbal Abilities: Speed vs. Accuracy

745 with Only Self-Prep and GMAT Club

From 555 to 765: 210-point Improvement

Perfect 805 Score Debrief by Julia

My Rewards

GMAT Problem Solving (PS) Questions

If x dollars is invested at 10 percent for one year and y

Prep Toolkit

615 to 715 in 15 Days (Ria's Strategies)

More than Quant/Verbal Abilities: Speed vs. Accuracy

745 with Only Self-Prep and GMAT Club

From 555 to 765: 210-point Improvement

Perfect 805 Score Debrief by Julia

My Rewards