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Mathematics 20 Online
OpenStudy (anonymous):

Arnulfo deposited $55 into a savings account for which interest is compounded semiannually. According to the rule of 72, what interest rate will cause his money to double in approximately 23 years?

OpenStudy (wolf1728):

The "rule of 72 formula" rate needed to double your money = 72 / years rate = 72 / 23 = 3.13% I could adjust the "rule of 72 formula" so that it calculates a semi-annual rate, but it would make the calculation a LOT more difficult than just dividing 72 by the rate. Rather than that, let's calculate the EXACT rate to double money in 23 years. http://1728.org/compint.htm For annual compounding it is 3.05955 % For semi-annual compounding it is 3.0365 %

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