Comments on: Calculating interest rate
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Comments on Ask MetaFilter post Calculating interest rateTue, 13 Jul 2010 14:22:30 -0800Tue, 13 Jul 2010 14:22:30 -0800en-ushttp://blogs.law.harvard.edu/tech/rss60Question: Calculating interest rate
http://ask.metafilter.com/159391/Calculating-interest-rate
Excel-finance future value help please.... Google Spreadsheet inside. <br /><br /> Solving for interest rate given the following:<br>
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1) Annual payment into an investment<br>
2) Known future value at year 20<br>
3) The tax rate<br>
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If someone could please provide me with the formula to use in my particular scenario to calculate this interest rate, I would be most grateful, thanks!<br>
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Here is my particular scenario:<br>
<a href="http://spreadsheets.google.com/ccc?key=0Ai41XkWa4cLYdGZqUURRUW5PQldTWHJrT29OR0E1dXc&hl=en">http://spreadsheets.google.com/ccc?key=0Ai41XkWa4cLYdGZqUURRUW5PQldTWHJrT29OR0E1dXc&hl=en</a><br>
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If you would like to be able to edit this sheet,<a href="http://dl.dropbox.com/u/2783497/Untitled%20spreadsheet.xls"> you can download the excel sheet here</a>. Thankspost:ask.metafilter.com,2010:site.159391Tue, 13 Jul 2010 14:05:58 -0800yoyoceramicfinanceexcelBy: jon1270
http://ask.metafilter.com/159391/Calculating-interest-rate#2285411
I don't have a formula for you, but excel's 'goal seek' function will handle this easily.comment:ask.metafilter.com,2010:site.159391-2285411Tue, 13 Jul 2010 14:22:30 -0800jon1270By: matthewr
http://ask.metafilter.com/159391/Calculating-interest-rate#2285414
The easiest way to do this is to use Excel's goal seek tool, which gives a CD rate of just over 5.7%. Set the goal seek to change the interest rate cell such that the future value at year 20 is the target amount.comment:ask.metafilter.com,2010:site.159391-2285414Tue, 13 Jul 2010 14:23:41 -0800matthewrBy: JPD
http://ask.metafilter.com/159391/Calculating-interest-rate#2285435
just use the "rate" function and then divide that by 1-tax ratecomment:ask.metafilter.com,2010:site.159391-2285435Tue, 13 Jul 2010 14:36:11 -0800JPDBy: RobinFiveWords
http://ask.metafilter.com/159391/Calculating-interest-rate#2286020
As JPD wrote, the RATE() function is probably the one you want.<br>
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For more general information, check out the Financial Formulas section at <a href="http://www.techonthenet.com/excel/formulas/index.php">http://www.techonthenet.com/excel/formulas/index.php</a>.<br>
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Many of these functions require the correct sign on the dollar amounts or an error will be returned. Typically the payment amount is given as negative and the present/future value is given as positive.comment:ask.metafilter.com,2010:site.159391-2286020Tue, 13 Jul 2010 19:16:50 -0800RobinFiveWords