My Learning Cart
?
Categories
Account

If a sum of money doubles in 10 years at compound interest, what is the annual i

₹0.0
Login to Download
  • 📥 Instant PDF Download
  • ♾ Lifetime Access
  • 🛡 Secure & Original Content

What’s inside this PDF?

Question: If a sum of money doubles in 10 years at compound interest, what is the annual interest rate?

Options:

  1. 7.2%
  2. 10%
  3. 5%
  4. 6%

Correct Answer: 7.2%

Solution: 

Using the rule of 72, Rate = 72/10 = 7.2%

If a sum of money doubles in 10 years at compound interest, what is the annual i

Practice Questions

Q1
If a sum of money doubles in 10 years at compound interest, what is the annual interest rate?
  1. 7.2%
  2. 10%
  3. 5%
  4. 6%

Questions & Step-by-Step Solutions

If a sum of money doubles in 10 years at compound interest, what is the annual interest rate?
  • Step 1: Understand that the money doubles in 10 years.
  • Step 2: Know that the rule of 72 is a quick way to estimate the interest rate needed to double your money.
  • Step 3: Use the formula from the rule of 72: Rate = 72 / Number of years.
  • Step 4: Substitute the number of years (10) into the formula: Rate = 72 / 10.
  • Step 5: Calculate the result: Rate = 7.2%.
  • Step 6: Conclude that the annual interest rate is approximately 7.2%.
  • Compound Interest – Understanding how compound interest works and how it affects the growth of an investment over time.
  • Rule of 72 – A simplified formula to estimate the number of years required to double the investment at a fixed annual rate of return.
Soulshift Feedback ×

On a scale of 0–10, how likely are you to recommend The Soulshift Academy?

Not likely Very likely
Home Practice Performance eBooks