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inna [77]
4 years ago
10

Ahmad just put some money into a cd that pays 11.3% interest compounded semiannually according to the rule of 72 in approximatel

y how many years will he have four times the amount of money that he has now
Mathematics
1 answer:
lilavasa [31]4 years ago
5 0
The "rule of 72" says that the doubling time in years is approximately 72 divided by the interest rate in percent. To make the money grow by a factor of 4 requires that it double twice, so will take twice as long as the period to double once.
  2×72/11.3 ≈ 12.7 . . . . years

_____
The "rule of 72" is an approximation. The actual quadrupling time for this interest rate and compounding is about 12.6 years. (The actual product of doubling time and nominal interest rate is about 71.25.)
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