Rule of 72 as a short cut method is explained by the formula:
A72 divided by the annual interest rate
BNone of these
C72 divided by (annual interest rate multiplied by discount factor)
DAnnual interest rate dividend by 72
Correct answer
A. 72 divided by the annual interest rate
Explanation
72 divided by the annual interest rate is the correct answer. Review the question and compare it with the other choices to remember this fact for future exams.