The Rule of Four Is a Simple Mathematical Approximation for

question 62

Multiple Choice

The Rule of four is a simple mathematical approximation for

• A) the present value required to double an investment.
• B) the future value required to double an investment.
• C) the payments required to double an investment.
• D) the number of years required to double an investment.

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Definitions:

Present Value

The current financial worth of a forthcoming sum of money or sequence of cash flows, with a particular rate of interest in mind.

Interest

The charge for the privilege of borrowing money, typically expressed as an annual percentage rate.

Invest

The process of distributing funds with the aim of earning revenue or gains.

Lump Sum

A single complete payment made at one time, as opposed to a series of payments made over time.