James W.

asked • 10/05/18

f=((((1+r)^n)-1)/r)c. I can't solve this for r

f = c  (1+r)n -1
.           r
 
A description of the formula is here:
 
https://www.investopedia.com/walkthrough/corporate-finance/3/discounted-cash-flow/annuities.aspx
 
I'm trying to solve for "r" which would calculate the rate of return required given a set regular payment (c) to reach the desired future value (f).
 
I'm stuck!
 
Any help would be greatly appreciated.
 
James
 

1 Expert Answer

By:

Michael E. answered • 10/05/18

Specializing in the Math Portion of the GED

James W.

Hi Michael,
Thanks for getting back to me.  This gets me further than I have managed to get so far, but do I still not have "r" on both sides?
Many thanks, James
Report

10/08/18

Michael E.

tutor
Hello James, I hate to admit it, but I looked right past that fact, and ... not seeing a way around it. Is this question from a business class where you are using a financial calculator, like the HP 10bII+, or does the class call for a graphing calculator like the TI-84? That is, are you supposed to solve r by hand, or use a feature in the calculator? Kind regards, Michael
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10/09/18

James W.

I can use my HP financial calculator to solve this but I was hoping to have a formula that I could use in excel. But like you, I cant see how to solve for r.
Report

10/11/18

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