IRR 3x Money in 3 Years is equal to what percentage?

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Multiple Choice

IRR 3x Money in 3 Years is equal to what percentage?

Explanation:
To triple your money in three years with a constant annual IRR, you’re looking for the rate r that satisfies (1 + r)^3 = 3. Solve for r: r = 3^(1/3) − 1. The cube root of 3 is about 1.442, so r ≈ 0.442, or about 44.2% per year. The closest option is 45%. If you check the other options, they don’t hit exactly 3x: 35% gives (1.35)^3 ≈ 2.46x, 25% gives ≈ 1.95x, and 55% gives ≈ 3.72x.

To triple your money in three years with a constant annual IRR, you’re looking for the rate r that satisfies (1 + r)^3 = 3. Solve for r: r = 3^(1/3) − 1. The cube root of 3 is about 1.442, so r ≈ 0.442, or about 44.2% per year. The closest option is 45%.

If you check the other options, they don’t hit exactly 3x: 35% gives (1.35)^3 ≈ 2.46x, 25% gives ≈ 1.95x, and 55% gives ≈ 3.72x.

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