Rule of 72

Previous Lesson: Effective Interest Rate

Next Lesson: Loan Amortization

Investors commonly ask the question that how long it would take to double the amount at a given rate of interest. To answer we use the rule of 72 or rule of 69.

rule of 72 formula

Example 1:

To estimate how long it will take Rs. 15,000 to grow to Rs. 30,000 at an annual growth rate of 10%?

rule of 72 example

Facebook Handel


Financial Management: Theory and Practice, Dr Eugene F Brigham & C Micheal Ehrhardt

Fundamentals of Financial Management: Concise Edition, Brigham Houston

The Economist Guide to Financial Management, John Tennet

Financial Management: Core Concepts, Raymond M Brooks