I have a compound interest function with the following parameters:
Value at time 0 = 13.8 Interest rate = 0.05 time interval = 10
I need to check quickly, (without a calculator, only pen and paper) which of the following options represents the minimum interest rate to represents at leat 50% of the first interest function.
Value at time 0 =3.3 time interval = 10 interest rate A = 0.05 interest rate B = 0.10 interest rate C = 0.15 interest rate D = 0.20
The growth is given by the formula:
V_10 = V_0 x ( 1 + i)^10
Is there some quick mental algorithm to do these computations to estimate the right answer?