Mack opened a CD 10 years ago at an interest rate of 7.8%, compounded monthly. According to the rule of 72, when did he have half the amount of money that he has now?

A. About 9.2 years ago
B. About 4.6 years ago
C. About 3.9 years ago
D. About 7.8 years ago

@calculusxy @countonme123

Question

Mack opened a CD 10 years ago at an interest rate of 7.8%, compounded monthly. According to the rule of 72, when did he have half the amount of money that he has now?

 		A.	About 9.2 years ago
 		B.	About 4.6 years ago
 		C.	About 3.9 years ago
 		D.	About 7.8 years ago

@calculusxy @countonme123

anonymous · Answer

i got d

anonymous · Answer

Do you know what the rule of 72 is?

anonymous · Answer

72 divided by 7.8 = 9.23

anonymous · Answer

but when he hit half that would be 4.6 i believe

calculusxy · Answer

I think that it is option B. The reason is because since it is asking for half the amount of money that he has now, I divided 72 by 2, which resulted in 36. Then I divided 36 by 7.8 which I got the quotient of 4.61~4.6 years ago.

anonymous · Answer

oooo ok

anonymous · Answer

@calculusxy  
however with the rule of 72 you have to divide 72 by years required for the investment, which would be 7.8.

calculusxy · Answer

No you have to divide 72 by the interest rate and the quotient will be the years it will take for it to double.