Simply take the number 72 and divide it by the number of interest rates. Therefore, to get 12 if the interest rate is 6%, divide 72 by 6.
This indicates that at a fixed annual interest rate of 6%, the investment will take approximately 12 years to double.
From accounting coach.com: When [Investment Rate per year as a percent] x [Number of Years] = 72, a rule says that an investment or cost will double. According to the Rule of 72, an investment that earns 6% annually compounded will double in 12 years.
The equation is: Time is equal to 72/r, where r is the interest rate. An investment will double in about 12 years, according to the 72 rule. For interest rates between 6% and 10%, the Rule of 72 is reasonably accurate and applies to compounded rates.
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