At a growth (interest) rate of 10 percent annually, how long will it take for a sum to double? To triple? Select the year that is closest to the correct answer. Solution PV = 1 ; FV = 2 ; rate = 10% PV * FVIF( X years , 10%) = FV Or FVIF( X years , 10%) = 2 If we see the FVIF table at 10% column we see that value 2 will come when years = 7.3 So, Approximate years = 7 ( For double) Siilarly, in FVIF table where value is 3 t 10% table is = 11.5 years So we will assume that money gets tripled in 12 years You can also use FVIF calculator to proof the answers above.

1. At a growth (interest) rate of 10 percent annually, how long will it take for a sum to double? To
triple? Select the year that is closest to the correct answer.
Solution
PV = 1 ; FV = 2 ; rate = 10%
PV * FVIF( X years , 10%) = FV
Or FVIF( X years , 10%) = 2
If we see the FVIF table at 10% column we see that value 2 will come when years = 7.3
So, Approximate years = 7 ( For double)
Siilarly, in FVIF table where value is 3 t 10% table is = 11.5 years
So we will assume that money gets tripled in 12 years
You can also use FVIF calculator to proof the answers above