A use the rule of 72 to estimate the doubling time in years, Ask an Expert

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a) Use the "rule of 72" to estimate the doubling time (in years) for the interest rate, and then calculate it exactly. (Round your answers to two decimal places.) 9% compounded annually. "rule of 72" yr exact answer yr

b) Find the effective rate of the compound interest rate or investment. (Round your answer to two decimal places.) 15% compounded monthly. [Note: This rate is a typical credit card interest rate, often stated as 1.3% per month.]

c) You have just received $185,000 from the estate of a long-lost rich uncle. If you invest all your inheritance in a tax-free bond fund earning 6.2% compounded quarterly, how long do you have to wait to become a millionaire? (Round your answer to two decimal places.)

d) You have just won $150,000 from a lottery. If you invest all this amount in a tax-free money market fund earning 6% compounded weekly, how long do you have to wait to become a millionaire? (Round your answer to two decimal places.)

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Financial Management, Finance

Category:- Financial Management
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