Which of the Following Is the Best Description of the Rule

question 23

Multiple Choice

Which of the following is the best description of the Rule of 72?

• A) The Rule of 72 tells how what an investment is worth when interest rates are expected to double.
• B) The Rule of 72 tells how what interest rates are when an investment is expected to triple.
• C) The Rule of 72 tells how long it takes an investment to triple at a given interest rate.
• D) The Rule of 72 tells how what interest rates are when an investment is expected to double.
• E) The Rule of 72 tells how long it takes an investment to double at a given interest rate.

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Definitions:

Deadweight Loss

A cost to society created by market inefficiency, which occurs when supply and demand are out of equilibrium.

Tax Revenue

The income that is gained by governments through taxation, used to fund public services and government obligations.

Excise Tax

A tax levied on specific goods, services, or transactions, often included in the price of products like tobacco, alcohol, and gasoline.

Deadweight Loss

The loss of economic efficiency that can occur when the equilibrium for a good or a service is not achieved or is not achievable.