Reference no: EM133111918

A useful rule of thumb to determine the time it takes your investment to double is to simply divide 72 by the expected return. For instance, if the annual expected return is 6%, the rule says that it will take 72/6=12 years for your investment to double. This is very close (but not exactly equal) to the actual time of 11.90 years it will take your initial investment to double. For which expected return value, the rule will hold exactly? That is, for which expected return the approximation given by the rule will be exactly equal to the time it will take your investment to double? Please express your answer as a percentage and use 3 decimals in your answer.