Question

When Would you need to use Rule 72 ?

Answer 1

Rule 72 is used in Finance to estimate the time it takes for an investment to double in value based on a fixed annual interest rate.

Step-by-step explanation:

Rule 72 is used in Finance to estimate the time it takes for an investment to double in value based on a fixed annual interest rate. It is commonly used in the context of compound interest calculations.

The rule states that to find the approximate number of years it takes for an investment to double, divide 72 by the annual interest rate. For example, if the interest rate is 6%, it would take approximately 12 years for the investment to double (72 ÷ 6 = 12).

Rule 72 can be a useful tool for individuals and investors to quickly estimate the potential growth of their investments and make informed financial decisions.

Answer 2

For example, if you want to know how long it will take to double your money at eight percent interest, divide 8 into 72 and get 9 years.