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Your neighbor is asking you to invest in a venture that will double your money in 7 year(s). Compute the annual rate of return that he is promising you?

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Answer: 10.3%

Explanation:

The Rule of 72 is useful here. The rule of 72 can be used to calculate the amount of time it would take to double an investment by dividing 72 by the interest rate.

As we already have the number of years the formula is;

7 = 72/i

i = 72/7

i = 10.3%

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