Question

Sally’s parents deposited $15,000 into a college savings account on her third birthday. The account had an interest rate of 9.6% compounded annually. They were hoping that the money would double twice by the time she was 18 years old. Using the rule of 72, mc009-1.jpg will their hopes come true? Yes, the $15,000 will double each 7.5 years. In 15 years, it will double twice. Yes, the $15,000 will double in 7.5 years and be four times as much in 15 years. No, the $15,000 will only double once in 15 years, not double twice. No, it will take 30 years for the $15,000 to double twice.

Answer 1

Rule of 72 says to divide 72 by the rate of return and that will be the number of years an investment will double
 so 72 / 9.6 = 7.5 years to double

7.5 * 2 = 15 years

18-3 = 15

 the answer is: Yes, the $15,000 will double each 7.5 years. In 15 years, it will double twice.

Answer 2

The correct answer is Yes! The 15,000 dollars will double.