Rule of 72 – Estimation of Compound Interest and Time

Effect of Compounding

The Rule of 72 is a good quick math shortcut to find out the following –

  • Time required for an amount to double itself, at a given rate of interest
  • Rate at which an amount should grow to double itself in given time

This formula can be applied for “Doubling Problems” related to money, population, etc. which grows at an annual compounded rate.

Formulae

  1. To calculate the time; T = 72/R
  2. To calculate the rate of interest; R= 72/T Read More
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How to calculate EMI?

EMI Calculation

In our daily life we face enormous application of mathematics. Calculation of equated monthly installments (EMI) for car or home loan is one such common application of mathematics.

EMI or equated monthly installments is the most popular form of loan payment.  It is a fixed amount of repayment made every month towards the loan, which includes payment towards both principal and interest. Most of us always believe the bank executives blindly on the figure which they quote as EMI.

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