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A savings account accrues 5% interest at the end of every fo
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Updated on: 11 Oct 2017, 20:48
Updated on: 11 Oct 2017, 20:48
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Question Stats:
75% (01:56) correct
25% (00:25) wrong based on 4 sessions
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A savings account accrues 5% interest at the end of every four months. Given an initial savings deposit of s, if an extra 10 dollars was deposited into the account immediately after the first year, which of the following choices represents the ending balance of the savings account after y years, where y > 1?
A. \((s)^3y - 3(1.05) + (10)^3y(1.05)\)
B. \((s)^3y(1.05) + (10)3y-3(1.05)\)
C. \((s)(1.05)^3y + (10)3y - 3\)
D. \((s)(1.05)^3y - 3 + (10)3y\)
E. \((s)(1.05)^3y + (10)(1.05)^3y - 3\)
A. \((s)^3y - 3(1.05) + (10)^3y(1.05)\)
B. \((s)^3y(1.05) + (10)3y-3(1.05)\)
C. \((s)(1.05)^3y + (10)3y - 3\)
D. \((s)(1.05)^3y - 3 + (10)3y\)
E. \((s)(1.05)^3y + (10)(1.05)^3y - 3\)
Re: Interest Question
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11 Oct 2017, 14:39
11 Oct 2017, 14:39
Expert Reply
We have an intial amount \(s\) that get intrest for \(y\) years.
Now rate of interest is \(5%\) and compunded every 4 months.
So after y years the amount would be \(= s \times (1 + \frac{5}{100})^{y \times 3}\)
Also an additional 10 dollars will accrue interest over \(y-1\) years \(= 10 \times (1 + \frac{5}{100})^{(y-1) \times 3}\)
Hence option E is correct!
Now rate of interest is \(5%\) and compunded every 4 months.
So after y years the amount would be \(= s \times (1 + \frac{5}{100})^{y \times 3}\)
Also an additional 10 dollars will accrue interest over \(y-1\) years \(= 10 \times (1 + \frac{5}{100})^{(y-1) \times 3}\)
Hence option E is correct!
PS: I do not think this is a GRE Question please share the source
Re: Interest Question
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11 Oct 2017, 16:44
11 Oct 2017, 16:44
Hi, it's from Manhattan online resources. BTW why you're thinking it's not a GRE question?
