Rory has $2,500 but needs $5,000 to purchase a new golf cart. If he can invest his money at a rate of 12% per year, approximately how many years will it take the money in Rory's account to grow to $5,000? Use the Rule of 72 to determine your answer. Note: The golf cart's price may have changed by the time Rory's account reaches a value of $5,000.
A) 2 years
B) 4 years
C) 6 years
D) 8 years

Question

Quizplus · Accepted Answer

According to the Rule of 72, we can estimate the number of years it will take for an investment to double by dividing 72 by the annual interest rate. In this case, dividing 72 by 12 gives us 6. So, it will take approximately 6 years for Rory's money to double and reach $5,000 at a 12% annual interest rate. Therefore, the best choice is C) 6 years.

Rory Has $2,500 but Needs $5,000 to Purchase a New