Which of the following interest rates will come closest to doubling invested money in five years?
A)13%
B)14%
C)15%
D)16%

Question

Quizplus · Accepted Answer

To approximate the number of years it takes to double invested money, we can use the rule of 72. This rule states that we can divide 72 by the annual interest rate to get an estimate of the number of years it takes for an investment to double. Using this rule, we can calculate the following:

- For an interest rate of 13%, it would take approximately 5.5 years to double invested money (72/13 = 5.5).
- For an interest rate of 14%, it would take approximately 5.1 years to double invested money (72/14 = 5.1).
- For an interest rate of 15%, it would take exactly 4.8 years to double invested money (72/15 = 4.8).
- For an interest rate of 16%, it would take approximately 4.5 years to double invested money (72/16 = 4.5).

Therefore, the best choice is C) 15%.

Which of the Following Interest Rates Will Come Closest to Doubling