AyhamAug 23, 2026
Solving Compound Interest Simply 📈
Solving Compound Interest Simply 📈
Ayham
Learn how to solve a compound interest investment problem simply and quickly by breaking down the doubling periods without complex formulas.
Solving Compound Interest Simply 📈
Ayham
Learn how to solve a compound interest investment problem simply and quickly by breaking down the doubling periods without complex formulas.
Chapters
00:00
Introduction
Introduction to the problem and reading the given rule
00:31
Calculating Doubling Time
00:51
Solving the Problem
Transcript
00:00
You want to be really careful with this problem because you don't need to use a complex compound interest formula.
00:05
You just have to read what they tell you.
00:07
An investment compounded annually at x percent doubles in about 142x tiers.
00:13
Now, if this individual invests 6,000, so I'm going to write that down over there.
00:19
In a fund that pays 6% interest compounded annually, what will be the approximate total amount of the investment in 36 years?
00:29
So when it's 6%, well, how often does it double?
00:32
I'm going to say that's 140 divided by 2x2 times 6.
00:36
So that's 140 over 12.
00:38
And I know that 144 is 12 times 12.
00:41
So it doubles every just under 12 years.
00:45
So every 12 years it almost doubles.
00:47
And therefore, if I say after 12 years, it becomes 12k, another 12 years, it becomes 24k.
00:57
And now it's been how long?
00:58
24 years.
01:00
And so another 12 years makes it a total of 36 years.
01:05
And that doubles over here it becomes 48k.
01:08
So a lot of these problems seem complicated, but you just have to pay attention to the details and keep it simple.
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