Rs. 1 K is paid every month for 36 months.

Compounding interest rate is 10% anum right from start.

What is the acumulated amount at the end of 36th month?

A=P((1-(1+r)^(-n))/r, where A is the present value of the annuity, or the amount of the loan, P is the periodic payment, r is the interest rate per period, and n is the number of periods. In this case, I assume the payments are monthly, so n would be 36. You mentioned that you already have A and P. However, solving for r algebraically is not that easy because it is in two places on the right hand side. However, you can make a table and put in interest rates to make both sides equal. Remember to multiply this answer by 12 to get the annual interest rate.

For example, if the payment is $100, and the amount of the loan is $2,766.07, and the number of periods is 36, what is the interest rate.

r Calculate Actual Difference

0.010 3010.75 2766.07 -244.68

0.011 2959.42 2766.07 -193.35

0.012 2909.33 2766.07 -143.26

0.013 2860.42 2766.07 -94.35

0.014 2812.68 2766.07 -46.61

0.015 2766.07 2766.07 0.00

0.016 2720.55 2766.07 45.52

0.017 2676.11 2766.07 89.96

You can see from the chart that the value of r of 0.015 makes the difference 0, so the periodic interest rate is 0.015 or 1.5%. We need to annualize this by multiplying by 12 and we get an annual interest rate of 18%.

Good luck,

Paul

Annuity Payment PV

For example, if the payment is $100, and the amount of the loan is $2,766.07, and the number of periods is 36, what is the interest rate.

r Calculate Actual Difference

0.010 3010.75 2766.07 -244.68

0.011 2959.42 2766.07 -193.35

0.012 2909.33 2766.07 -143.26

0.013 2860.42 2766.07 -94.35

0.014 2812.68 2766.07 -46.61

0.015 2766.07 2766.07 0.00

0.016 2720.55 2766.07 45.52

0.017 2676.11 2766.07 89.96

You can see from the chart that the value of r of 0.015 makes the difference 0, so the periodic interest rate is 0.015 or 1.5%. We need to annualize this by multiplying by 12 and we get an annual interest rate of 18%.

Good luck,

Paul

Annuity Payment PV

Aug 15, 2016 | Calculators

That question is much more complicated than you think - are you charging interest percentage daily? Weekly? Monthly? Anually? Once you have the period figured, you begin at some start point of your choosing. Exactly one "period" later, you multiply the basis (the outstanding balance) by the percentage rate (5%, for example, would mean you multiply by 0.05), then add that number to the basis - that's your new basis, your new outstanding balance.

But... if you charge an annual interest rate, and you compound daily or weekly or monthly, you have to take payments into account and adjust for them - it's fair to charge interest up to the moment of payment, but not beyond that moment; you can rightly only charge interest on the remaining unpaid balance beyond that date.

If you charge an annual interest rate but compound monthly, then every month you'd charge 1/12 of your annual interest rate. If weekly, 1/52. If daily, 1/365. The smaller the compounding period, the easier it is to calculate interest around payments, but the more paperwork is involved.

But... if you charge an annual interest rate, and you compound daily or weekly or monthly, you have to take payments into account and adjust for them - it's fair to charge interest up to the moment of payment, but not beyond that moment; you can rightly only charge interest on the remaining unpaid balance beyond that date.

If you charge an annual interest rate but compound monthly, then every month you'd charge 1/12 of your annual interest rate. If weekly, 1/52. If daily, 1/365. The smaller the compounding period, the easier it is to calculate interest around payments, but the more paperwork is involved.

Jul 14, 2014 | Calculators

That's 10,000 for 10 years at 6% interest compounded month.

Press

1 0 0 0 0 * ( 1 + . 0 6 / 1 2 ) y^x ( 1 0 * 1 2 ) =

Press

1 0 0 0 0 * ( 1 + . 0 6 / 1 2 ) y^x ( 1 0 * 1 2 ) =

Apr 07, 2011 | Texas Instruments Calculators

4 5 0 0 0 +/- PV (investment amount, negative because you're paying it out)

2 5 0 0 0 0 FV (desired amount, positive because you're receiving it)

2 0 SHIFT xP/YR (20 years)

I/YR (calculate annual interest rate)

2 5 0 0 0 0 FV (desired amount, positive because you're receiving it)

2 0 SHIFT xP/YR (20 years)

I/YR (calculate annual interest rate)

Jan 23, 2011 | HP 10bII Calculator

If the interest is compounded monthly:

2nd [CLR TVM] (clear any existing results)

1 5 0 0 0 _/- PV (present value, negative because you're paying it out)

6 I/Y (annual interest rate)

25 2nd [*P/Y] N (25 years)

CPT FV (compute future value, see 66,974.55)

If the interest is compounded annually:

2nd [CLR TVM] (clear any existing results)

1 5 0 0 0 _/- PV (present value, negative because you're paying it out)

6 I/Y (annual interest rate)

2nd [P/Y] 1 ENTER 2nd [QUIT] (one compounding period per year)

25 N (25 years)

CPT FV (compute future value, see 64,378.96)

2nd [CLR TVM] (clear any existing results)

1 5 0 0 0 _/- PV (present value, negative because you're paying it out)

6 I/Y (annual interest rate)

25 2nd [*P/Y] N (25 years)

CPT FV (compute future value, see 66,974.55)

If the interest is compounded annually:

2nd [CLR TVM] (clear any existing results)

1 5 0 0 0 _/- PV (present value, negative because you're paying it out)

6 I/Y (annual interest rate)

2nd [P/Y] 1 ENTER 2nd [QUIT] (one compounding period per year)

25 N (25 years)

CPT FV (compute future value, see 64,378.96)

Oct 26, 2010 | Texas Instruments BA-II Plus Calculator

A = P(1 + r/q)nq is the formula you use. first write it all out, where P is the principle or $5000, r is the rate of 6%, q is the times per year so it would be 12 if done monthly, and n is how many years which would be 10. hope this helps.

Apr 28, 2010 | Texas Instruments BA-II Plus Calculator

No. To the nearest cent, the monthly interest is $162.50. The monthly payments only pay the interest, without reducing the principal.

Apr 15, 2009 | Texas Instruments TI-83 Plus Calculator

The actual interest rate is 36%. (1.5*24). Where did you get the 0.5666667 from 24/36 is 0.6666667.

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Dec 10, 2008 | Calculators

set your p/y to 12( compounding periods per year). I think you are calculating for a one year loan?

Nov 18, 2008 | Texas Instruments BA-II Plus Calculator

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Aug 01, 2008 | Calculators

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