Calculate the interest rate per period charged on a loan or the rate of return needed to reach a specified amount on an investment over a given period.
Annuity_Rate(nper, pmt, pv, [fv], [type], [guess])
|nper||Yes||double||Total number of payment periods in the annuity|
|pmt||Yes||double||Payment to be made each period|
|pv||Yes||double||Present value, of a series of future payments or receipts|
|fv||No||double||Future value you want after you make the final payment (Defaults 0)|
|type||No||int||Indicates when payments are due. Use 0 for payments due at the end of the payment period. Or 1 due at the beginning of the period (Defaults 0)|
|guess||No||double||Value you estimate will be returned by the function (Defaults 0.1)|
Annuity_Rate(60, -100, 5000) Returns 0.006183
You are taking out a loan of $5,000. The loan term is 5 years and payments are made monthly (60 payments). Loan payments are $100 per month. What would the yearly interest rate be for this loan?
Annuity_Rate(60, -100, 5000) * 100 * 12 Returns (7.42% yearly)
The function returns the monthly rate so we multiply by 100 to percentage & 12 to get yearly.