Annuity Calculation
Annuity Calculation
Annuity Calculation question?
Given that FVoa = PMT [((1 + i)n - 1) / i], how can you rearrange the formula to solve for i?
If you prefer numbers to formulae, here are the given values:
FVoa = 1365
n=13
PMT=100
Thanks to all that attempt this!
FVoa = PMT [((1 + i)n - 1) / i]
Just realized that the n is supposed to be an exponent.
Should look more like this:
FVoa = PMT [(((1 + i)^n) - 1) / i]
Thanks again!
F=P[ ( (1+i)n -1) / i]
F/P = [(1+i)n -1] /i
i(F/P) = (n+ni -1)
i(F/P-n)=n-1
i=(n-1) / (F/P-n) —- (1)
Are you sure that it is (1+i)n? (1) solves for i using FV, PMT, and n as given in your question.
Excel Busn Math 60: Future Value Annuities FV & PMT function
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