Answer:
10.3 years
Explanation:
The Rule of 72 is a rule used to determine the period of time it would take an investment to double at a given fixed annual rate of return. The rule of 72 helps investors to have an estimate of how long an initial investment would double. The rule of 72 is given by the formula:
t = 72 / r
where r is the annual rate of return and t is the approximate time in years required for the investment to double.
t = 72 / r
Given that r = 7%
t = 72 / r = 72 / 7 = 10.3 years
Therefore it would take 10.3 years for an investment of $5,000 earning 7% annually to double to about $10,000