How to find interest rate?

  • Thread starter Thread starter Shital Shah
  • Start date Start date
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Shital Shah

If we have invested Rs 50,000 for six years and if we have
received Rs 80,052, then how can we find out the interest
we have received per annum? or On what rate of interest
have i received this amount.

Shital
 
Shital,

Forgive me if this is a re-post, but my reader isn't showing my previous
reply.

=RATE(6,0,-50000,80052)

or about 8.16% annually.

HTH,
Bernie
MS Excel MVP
 
if you just want to solve this problem, you will have to
look into some grade 10 math book or go to
http://www.moneychimp.com/articles/finworks/fmfutval.htm
and click calculator and then rate of return. enter your
amounts will give you your rate.

i hvnt done this on excel but you can enter a compund
interest formula that will return interest rate. there are
two interest formulas in excel (IPMT and ISPMT) go in
excel help to check the definitions of the parameters.

hope this helps
 
Hi Shital!

By direct formula use:

=(80052/50000)^(1/6)-1
Returns: 8.16008761410352%

Or use the RATE function:

=RATE(6,0,-50000,80052,0,0)
Returns: 8.16008761410334%

Note that the RATE function uses a sign of money flows convention where
monies paid out or obligations to pay are negative and monies in or rights
to receive are positive.
--
--
Regards
Norman Harker MVP (Excel)
Sydney, Australia
Excel and Word Function Lists (Classifications, Syntax and Arguments)
available free to good homes.

(e-mail address removed)
Excel and Word Function Lists (Classifications, Syntax and Arguments)
available free to good homes.
 
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