Have you always wanted to be able to do compound interest problems in your head? Perhaps not... but it's a very useful skill to have because it gives you a lightning fast benchmark to determine how good (or not so good) a potential investment is likely to be. Show
The rule says that to find the number of years required to double your money at a given interest rate, 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 eight percent interest, divide 8 into 72 and get 9 years.
Compound Interest CurveSuppose you invest $100 at a compound interest rate of 10%. The rule of 72 tells you that your money will double every seven years, approximately:
If you graph these points, you start to see the familiar compound interest curve:
 Practice using the Rule of 72It's good to practice with the rule of 72 to get an intuitive feeling for the way compound interest works. So... Why Stop at a Double?There's nothing sacred about doubling your money. You can also get a simple estimate for other growth factors, as this calculator shows: Why Does the Rule of 72 Work?If you want to know more, see this explanation of why the rule of 72 works. (Brace yourself, because it's slightly geeked out.) Home Find the rate at which a sum of money will double itself in 3 years, if the interest is compounded annually. Question Open in App Solution Let Principal (P)=Rs. 100 then Amount(A)=Rs. 200 Period(t)=3 years. Let R be the rate %.Since, we have A=P(1+R100)3Substitute given values, we get ⇒200=100(1+R100)3⇒200100=(1+R100)3⇒3√2=(1+R100)⇒1.2599=1+R100⇒R100=1.2599−1⇒R=0.2599×100∴R=25.99% per annum.Suggest Corrections 14 Same exercise questions Q. A sum amounts to Rs. 756.25 at 10% per annum in 2 years, compounded annually. Find the sum. Q. What sum will amount to Rs. 4913 in 18 months, if the rate of interest is 1212% per annum, compounded half-yearly. Q. Find the principal of the interest compounded annually at the rate of 10% for two years is Rs. 210. Q. The difference between the compound interest and simple interest on a certain sum at 15% per annum for 3 years isRs. 283.50. Find the sum. Q. On what sum will the compound interest at 5% p.a. annum for 2 years compounded annually be Rs. 164? View More At what interest rate compounded semi annually will money double itself in 10 years?Hence, it will take 10 years for the sum of money to double itself with the rate of 10% per annum simple interest.
At what rate of interest will the money double itself in 12 years 6 months?r=12100=831percent.
How many years will a sum of money doubles itself at 12% per annum?In this problem, it is given that the rate is 12 % per annum and we need to find the time in which the principal amount doubles. The total amount at the end of N years is the sum of simple interest and the principal amount. Hence, the required time is 8 years and 4 months.
How do you calculate interest compounded semi annually?How to calculate interest compounded semiannually. Add the nominal interest rate in decimal form to 1. The first order of operations is parentheses, and you start with the innermost one. ... . Solve step one to the power of how many compounding periods. ... . Subtract from step two. ... . Multiply step three by the principal amount.. |
At what interest rate compounded semi annually will money double itself in 12 years *?
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