Question

Stuart put $99 into a CD that pays 2.6% interest, compounded monthly. According to the Rule of 72, approximately how long will it take for his money to double? Round to the nearest tenth. Show your work.

Answer 1

Answer:  27 years (approx)

Step-by-step explanation:

According to the Rule of 72,

If the product of interest rate and time is equal to 72, the amount will be doubled.

According to the question,

The annual rate = 2.6%

Let after t years the amount will be doubled.

Thus, 2.6 × t = 72

$t = \frac{72}{2.6} = 27.6923076923$

Since, the actual time will always less than the time gets by the 72 rule.

Thus, Approx 27 year after the amount will be doubled.

Answer 2

72/2.6=27.7 years
Hope it helps :-)