Arithmetic

Compound interest calculates interest on both the initial principal and any accrued interest over time.. After two years of annual compounding at 10%, the total value of the investment grows to $1210, meaning the earned interest alone is $210.

The probability of drawing the first red marble is 4/10, and drawing a second red marble without replacement is 3/9, yielding a combined probability of (4/10) * (3/9) = 12/90, which simplifies to 2/15. Option C is incorrect because it assumes replacement, calculating the probability as (4/10) * (4/10) = 16/100, or 4/25.

The correct answer, $210, is the interest earned on the initial $1000 investment after two years of annual compounding at 10%. A diagram for this topic isn't available yet — the worked example below walks the same reasoning step by step.

• !Many people mistakenly calculate simple interest, which would be $100 per year for two years, totaling $200, or they incorrectly identify the total account balance of $1210 as the interest earned.
• !Some people may mistakenly assume that the average is necessarily the largest or smallest number in the sequence, rather than the middle number when there is an odd number of consecutive integers.
• !Distractors often represent the initial tax amount or a partial tax amount, failing to account for the full tax rate.
• !Distractor D is incorrect because $1210 represents the final account balance rather than just the interest.
• !Choice A is incorrect because 12 is the average and middle term of the set, not the largest.

Answer each from memory — you'll see instantly whether you're right and why.

Run a focused 10-question mini-mock on Arithmetic and see it stick.