maxpowers
01-30-2009, 02:36 AM
Hi all,
I just wanted to post this little tidbits about exponential growth math so that we can see through the rhetorics thrown at us all the time. Have you aver thought about how long it takes something (money, population, etc) to double given a constant growth rate of say 5% annually? Now most people will say that 5% is small. For example, let's say I have a million dollars, it would take me approximately 14 years to have 2 millions, 28.5 years for 4 millions, and 43 years for 8 millions. So within a working lifetime of passively letting the million grow, I have gain 800% of the original. Now think back to the California fiscal budget ( I think around 100 billions dollars), if the government want to grow the revenues (taxes) at say 5%, in 14 years our budget will be 200 billions dollars, 28.5 years it will be 400 billions, and almost a trillion by the time your kids and grandkids grows up. Scary enough? Do you think your income or your children's income will be double or quadruple in that time frame?
The math is simple. It is the "Rules of 72". Take 72 divided by the number for the annual percent growth and you get the approximate time it takes to double something. For example 72 divided by 5 get you 14.4 years or months or whatever time frame the growth is set at.
I just wanted to post this little tidbits about exponential growth math so that we can see through the rhetorics thrown at us all the time. Have you aver thought about how long it takes something (money, population, etc) to double given a constant growth rate of say 5% annually? Now most people will say that 5% is small. For example, let's say I have a million dollars, it would take me approximately 14 years to have 2 millions, 28.5 years for 4 millions, and 43 years for 8 millions. So within a working lifetime of passively letting the million grow, I have gain 800% of the original. Now think back to the California fiscal budget ( I think around 100 billions dollars), if the government want to grow the revenues (taxes) at say 5%, in 14 years our budget will be 200 billions dollars, 28.5 years it will be 400 billions, and almost a trillion by the time your kids and grandkids grows up. Scary enough? Do you think your income or your children's income will be double or quadruple in that time frame?
The math is simple. It is the "Rules of 72". Take 72 divided by the number for the annual percent growth and you get the approximate time it takes to double something. For example 72 divided by 5 get you 14.4 years or months or whatever time frame the growth is set at.