
Economics Economics Forum  Financial Mathematics, Econometrics, Operations Research, Mathematical Finance, Computational Finance 
 LinkBack  Thread Tools  Display Modes 
March 8th, 2013, 08:55 AM  #1 
Newbie Joined: Mar 2013 Posts: 4 Thanks: 0  How it solve Interest on financing?
hello, Sorry for my english, I'm from Brazil I have a simple question ... I would like to solve using formulas on paper because the result I found using the hp 12c. data Funding Amount  $ 15,000.00 Value of shares  R $ 1.400,00 Number of months  12 months The interest will be? Answer: 1.7881% I was using this formula: PV= (1  (1+i)^n / i) . p available on this link https://www3.bcb.gov.br/CALCIDADAO/publ ... acoesFixas Thanks 
March 8th, 2013, 12:24 PM  #2  
Math Team Joined: Oct 2011 From: Ottawa Ontario, Canada Posts: 14,597 Thanks: 1038  Re: How it solve Interest on financing? Quote:
Anyway, the formula you are using is the Present Value of an annuity. As example, $100 per month for 12 months at 6% annual compounded monthly: Present Value = [100 * (1  (1 + .06/12)^(12))] / (.06/12) = 1161.89 Please clarify your problem...  
March 8th, 2013, 08:33 PM  #3 
Newbie Joined: Mar 2013 Posts: 4 Thanks: 0  Re: How it solve Interest on financing?
I wrote wrong the correct is $ 15.000 Value of shares  $ 1.400 Number of months  12 months The question is a financing of $ 15,000 that is paid 12 times $ 1,400, what is the interest rate? I would like to find the response of interest rate but using the formula, I don't know what is the correct formula. using the calculator on this site https://www3.bcb.gov.br/CALCIDADAO/publ ... acoesFixas I find the interest rate the Answer: 1.7881%  using calculator financeria How do I get this same result using the traditional method, with formula, pencils and paper? Thanks 
March 9th, 2013, 04:17 AM  #4 
Math Team Joined: Oct 2011 From: Ottawa Ontario, Canada Posts: 14,597 Thanks: 1038  Re: How it solve Interest on financing?
Sorry, but me no understando... An example (may help you): a stock had a dividend of $1.50, a price per share of $60.00, and an expected growth rate of 10%: rate of return = [(1.50(1 + .10)) ÷ 60] + .10 = .1275, or 12.75% 
March 9th, 2013, 06:14 AM  #5 
Newbie Joined: Mar 2013 Posts: 4 Thanks: 0  Re: How it solve Interest on financing?
Denis, The question : A funding of $ 15.000 is paid in 12 installments of $ 1.400 which is the interest rate? I know this interest rate is 1.7881% but how can I arrive this result? without using financial calculator 
March 9th, 2013, 10:43 AM  #6  
Math Team Joined: Oct 2011 From: Ottawa Ontario, Canada Posts: 14,597 Thanks: 1038  Re: How it solve Interest on financing? Quote:
This is simply a loan of $15 repaid over 12 months, monthly payment being $1.40: what is interest rate? Formula for loan payment: P = A*i / [1  (1 + i)^(n)] P = Payment A = Amount of loan i = interest rate n = number of payments So, with your example: 1.4 = 15*i / [1  (1 + i)^(12)] That style of equation CANNOT be solved directly; numeric methods are required (like guess and check). Have a look here: http://www2.math.umd.edu/~immortal/206/ ... ally.shtml If you want to see more sites, google "solving numerically". The rate of 1.7881 you quoted is correct; that' s .017881 compounded monthly. Did I impress you enough for you to come up to Canada and marry me? :P  
March 10th, 2013, 06:28 PM  #7 
Newbie Joined: Mar 2013 Posts: 4 Thanks: 0  Re: How it solve Interest on financing?
Thanks you, helped me a lot, but I can not marry you because I am man ... kkkkk I'll research about it on google .. see you later 
March 10th, 2013, 08:18 PM  #8  
Math Team Joined: Oct 2011 From: Ottawa Ontario, Canada Posts: 14,597 Thanks: 1038  Re: How it solve Interest on financing? Quote:
 

Tags 
financing, interest, solve 
Search tags for this page 
Click on a term to search for related topics.

Thread Tools  
Display Modes  

Similar Threads  
Thread  Thread Starter  Forum  Replies  Last Post 
Simple Interest: How to find the actual interest rate?  grace25  Elementary Math  12  January 24th, 2013 08:46 PM 
Interest  jeanjake  Algebra  2  October 3rd, 2012 04:42 AM 
Simple interest/Compound interest  Qwertyqwerty  Elementary Math  2  September 20th, 2011 10:41 PM 
Calculate interest rate based on interest in parcels  douglasrac  Economics  0  February 17th, 2011 09:14 AM 
interest  kfarnan  Algebra  3  February 13th, 2011 03:30 PM 