Question

According to the rule of 72, t=72/r which statement is true?

a.An investment of $3,100 will double in 12 years at a compound interest rate of 5%.

b.An investment of $9,000 will double in 10 years at a compound interest rate of 7%.

c.An investment of $4,500 will double in 8 years at a compound interest rate of 9%.

d.An investment of $3,000 will double in 4 years at a compound interest rate of 12%.

Answer 1

72/rate=time
72/9=8 years
So the answer is c

Answer 2

Answer:

C. An investment of $4,500 will double in 8 years at a compound interest rate of 9%.

Step-by-step explanation:

Since, according to rule of 72,

An investment is doubled in a fixed annual rate of interest when the product of time ( in years ) and annual rate ( in percentage ) is 72.

In option A :

Annual rate of interest = 5 % and time = 12 years,

But, 5 × 12 ≠ 72,

Thus, option A is incorrect.

In option B :

Annual rate of interest = 7 % and time = 10 years,

But, 7 × 10 ≠ 72,

Thus, option B is incorrect.

In option C :

Annual rate of interest = 8 % and time = 9 years,

But, 8 × 9 = 72,

Thus, option C is correct.

In option D :

Annual rate of interest = 12 % and time = 4 years,

But, 12 × 4 ≠ 72,

Thus, option D is incorrect.