Money Yielded Percent= 200(S+D-C)/C, where C is the cost of purchasing the 10 year saving bond, D is the amount of dividend received, S is the selling price of the bonds, and Money Yielded is the yield of the investment as a percent. If Julie purchased $200 worth of bonds, received a dividend of $10, and sold the bonds for $230 six months after purchasing them, what was the yield of her investment according to the formula?

A. 8%

B. 10%

C. 18%

D. 24%

E. 40%

Answer

We are told that the yield is 200 {(S + D - C)/C, where D is the dividend received, S is the sale price, and C is the cost of purchasing the bonds.

Plugging the values given into our formula, we get y = 200(230 +10 - 200)/200. The product of these two terms will have a 200 in both the numerator and the denominator, and so these will cancel out. We are left with: y =230 + 10 - 200 = 40. We were told in the question that y is a percent; choice E, 40%, is therefore correct.

Answer - Choice E

Essential GMAT Reading Comprehension Guide

After reading F1GMAT’s Essential GMAT Reading Comprehension Guide, you will:

1. Complete GMAT RC Questions in less than 1 minute and 50 seconds

2. Read Faster

3. Take Notes Effectively

4. Collect and Interpret Facts

5. Speed up Summary Creation

6. Remember Information

7. Question the Author

8. Learn to Answer GMAT Reading Comprehension Title question

9. Learn to Answer GMAT Reading Comprehension Main Idea Question

**(2019 Edition) (100+ New Questions)**

Mastering GMAT Critical Reasoning

After you read F1GMAT’s Mastering GMAT Critical Reasoning Guide, you will learn:

How to overcome flawed thinking in GMAT Critical Reasoning?

**(2019 Edition) (25+ New Questions)**