The rule of 72 that represents the annual interest rate is defined below , the rate is 4.5% .
In the question ,
it is given that ,
Miguel is planning to retire after 16 years ,
and he wants to double his money ,
The Rule of 72 is a simplified formula , that is used to calculate the time that an investment will take to double the value , based on its rate of return .
By the rule of 72 ,
Number of years that would take an investment to double = 72/(rate of interest )
n = 72/r
given the time is 16 years .
16 = 72/r
r = 72/16
r = 4.5%
Therefore , The rule of 72 that represents the annual interest rate is defined below , the rate is 4.5% .
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