Which Statement About the Rule of 70 Is NOT True

question 116

Multiple Choice

Which statement about the Rule of 70 is NOT true?

• A) It is a valuable tool for understanding the power of compounding growth rates over time.
• B) It is fairly accurate for small growth rates.
• C) It becomes more accurate over time.
• D) It is an easy way to approximate the number of years it takes for an amount to double in value.

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Definitions:

Limited Partnership

A business structure in which one or more of the owners may be granted limited liability as long as one partner is designated as a general partner with unlimited liability.

General Partnership

A business structure in which the business owners share the management and risk of the business.

Limited Liability

A legal structure that protects company owners' personal assets from business debts and liabilities.

Legal and Administrative Costs

Expenses incurred by a business for legal services and administrative operations.