ECONOMICS
COMPOUND INTEREST
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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An initial investment of $1000 is deposited in an account with a 1.2% interest rate, compounded annually. In how many years will the account reach $1500?
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34.04 years
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33.99 years
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3.72 years
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3.58 years
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Explanation:
Detailed explanation-1: -Thus, the interest rate should be 41.42%.
Detailed explanation-2: -Hence, the rate of interest in order to triple the investment is 3.73 %.
Detailed explanation-3: -Thus, the interest rate should be 24.57%.
Detailed explanation-4: -According to the Rule of 72, it would take about 14.4 years to double your money at 5% per year.
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