ECONOMICS
COMPOUND INTEREST
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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$1, 200
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$3, 700
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$3, 933.80
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$1, 433.80
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Detailed explanation-1: -Therefore, it will take 50 years to get the double amount at a simple interest rate 2 % per annum.
Detailed explanation-2: -Summary: An investment of $10000 today invested at 6% for five years at simple interest will be $13, 000.
Detailed explanation-3: -If you earn 12% on average, this rule calculates that your money doubles in 72/12 = six years. If you earn on average 8%, your investment should double in approximately 72/8 = nine years.
Detailed explanation-4: -A 10% interest rate will double your investment in about 7 years (72 ∕ 10 = 7.2); an amount invested at a 12% interest rate will double in about 6 years (72 ∕ 12 = 6). Using the Rule of 72, you can easily determine how long it will take to double your money.