The rule of 72s states that the number of years for an investment to double is approximately 72 divided by the interest rate percentage. For example, about 12 years are required for an investment to double at 6% interest (12 years = m/6). Find the exact rate required to double an investment in 6, 8,9, 12, 18, and 24 years, and compare this with the approximate rule of 72s rate.

The rule of 72s states that the number of years for an investment to double is approximately 72 divided by the interest rate percentage. For example, about 12 years are required for an investment to double at 6% interest (12 years = m/6). Find the exact rate required to double an investment in 6, 8,9, 12, 18, and 24 years, and compare this with the approximate rule of 72s rate.

Microeconomics

13th Edition

ISBN:9781337617406

Author:Roger A. Arnold

Publisher:Roger A. Arnold

Chapter16: Interest, Rent, And Profit

Section: Chapter Questions

Problem 1WNG

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