Question

When would you need to use the Rule of 72?

A To figure out the interest rate for your savings account
B To find out how long it will take your money to double
C To estimate how much money you’ll have in your account in 72 years
D To calculate a reasonable monthly savings goal

Answer 1

Hello there,

Your correct answer is "To find out how long it will take your money to double".

The rule 72 is a method for estimating how long it will take compound interest to cause a principal to double by dividing the interest rate by 72.

Hope this helps.

~Jurgen

Answer 2

B. To find out how long it will take your money to double

Step-by-step explanation:

The Rule of 72 states that the number of years that would be required in order to double an individual's or institution's money at a given interest rate. In order to achieve this you just divide the interest rate into 72.

For example, if you want to know how long it will take to double your money at six percent interest, divide 6 into 72 and get 12 years.