Thursday, February 9, 2017

Rule of 72 Applied to Water

Interesting line in the Dallas Business Journal - - "In the next seven years, officials [North Texas Municipal Water District] expect water rates to rise 10 percent a year."  The Rule of 72 is a quick tool to quantify what this means.  The Rule of 72 provides an estimate of when an investment/cost increase would double.  You divide 72 by the rate of return - - in the case of a 10% annual water rate increase - - your water bill will double in around seven years.

  Image result for rule of 72 table

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