3 ms·
Also checkout the "rule of 72" if this stuff tickles you. It is also a rough estimate that gets used in place of more complex formulas. (Actually closer to 69/7
by BatteryMountain 4y ago
Also checkout the "rule of 72" if this stuff tickles you. It is also a rough estimate that gets used in place of more complex formulas. (Actually closer to 69/70 but 72 makes things cleaner)
- FabHK 4y agoThe 72 is optimised, it seems to me, for annual compounding with percentages from 5% to 10% (as ln(2)/ln(1.08)*8 = 72.051746736), while, as you point out correctly, ln(2) = 0.69314718, so for continuous compounding 69 would be better indeed.