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QOTD#24 Carmen wants to open a special savings account thro

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GMAT Club Legend
GMAT Club Legend
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Joined: 07 Jun 2014
Posts: 4749
GRE 1: Q167 V156
WE: Business Development (Energy and Utilities)
Followers: 93

Kudos [?]: 1650 [0], given: 396

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QOTD#24 Carmen wants to open a special savings account thro [#permalink] New post 30 Apr 2017, 14:10
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Question Stats:

25% (00:00) correct 75% (01:00) wrong based on 8 sessions
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?

Indicate all possible values.

A. At the end of April, Carmen will have earned $105 in interest.
B. At the end of the year, Carmen will have earned $420 in interest.
C. At the end of six months, Carmen will have earned $35 in interest.
D. At the end of three months, Carmen will have $7,105 in the account.

[Reveal] Spoiler: Answer
B, D


Drill 4
Question: 10
Page: 323
[Reveal] Spoiler: OA

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1 KUDOS received
GMAT Club Legend
GMAT Club Legend
User avatar
Joined: 07 Jun 2014
Posts: 4749
GRE 1: Q167 V156
WE: Business Development (Energy and Utilities)
Followers: 93

Kudos [?]: 1650 [1] , given: 396

CAT Tests
Re: QOTD#24 Carmen wants to open a special savings account thro [#permalink] New post 04 May 2017, 01:19
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Expert's post
Explanation

To calculate the interest earned, multiply the principal by the annual interest rate: in one year, Carmen will earn $7000 × 0.06 = $420 in interest, so choice (B) works.

To calculate her interest for any part of the year, divide $420 by the appropriate fraction of a year. At the end of April, \(\frac{1}{3}\) of the year has passed, so Carmen will have earned \(\frac{1}{3} \times $420 = $140\); eliminate choice A.

At the end of six months, Carmen will have earned \(\frac{1}{2} \times $420 = $210\); eliminate choice (C).

At the end of three months, \(\frac{1}{4}\) of the year has passed, so Carmen has earned \(\frac{1}{4} \times $420 = $105\); there will be a total of $7000 + $105 = $7105 in the account,

so choice (D) works.
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Re: QOTD#24 Carmen wants to open a special savings account thro   [#permalink] 04 May 2017, 01:19
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QOTD#24 Carmen wants to open a special savings account thro

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