Question

Andre just turned 16. He received $500 from friends and family for his birthday. He decides to put the $500 into a U.S. government bond that grows 5% annually. How long will it take for the investment to double in value?

Answer 1

It will take about 14.4 years for Andre's investment to double in value.

Step-by-step explanation:

To calculate how long it will take for an investment to double in value, we can use the rule of 72. The rule of 72 is a quick way to estimate the number of years it takes for an investment to double, given a fixed annual interest rate. By dividing 72 by the interest rate, we can determine approximately how many years it will take for the investment to double.

In this case, the annual interest rate is 5%, so we divide 72 by 5 to get approximately 14.4 years. Therefore, it will take about 14.4 years for Andre's investment to double in value.