A Convenient Rule of Thumb Called the "Rule of 72

question 76

Multiple Choice

A convenient rule of thumb called the "rule of 72" states that a quantity growing at x percent per year doubles in size approximately every (72/x) years.
-Refer to the information above.If an economy has a real GDP doubling-time of 48 years,this can be reduced to 30 years if annual GDP growth is raised by ________ percentage points.

• A)4
• B)2.4
• C)1.6
• D)0.9

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Definitions:

Activity Variance

The difference between actual activity levels and those projected, affecting budgeted and actual costs.

Total Expenses

The sum of all costs and expenses associated with operating a business.

Flexible Budget

A financial planning tool that dynamically adjusts to volume or activity level changes.

Spending Variance

The variance between the real expenditure and the anticipated budget over a specific timeframe.