# How it solve Interest on financing?

#### alexapaula

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:??

I was using this formula: PV= (1 - (1+i)^n / i) . p

Thanks

#### Denis

Math Team
alexapaula said:
Funding Amount - $15,000.00 Value of shares - R$ 1.400,00
Is funding amount 15 thousand dollars? Is share one dollar and forty cents? What does ",00" mean?

Anyway, the formula you are using is the Present Value of an annuity.
a price per share of $60.00, and an expected growth rate of 10%: rate of return = [(1.50(1 + .10)) ÷ 60] + .10 = .1275, or 12.75% #### alexapaula Denis, The question : A funding of$ 15.000 is paid in 12 installments of $1.400 which is the interest rate? I know this interest rate is 1.7881% but how can I arrive this result? without using financial calculator #### Denis Math Team alexapaula said: A funding of$ 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 Ahhhhhhhhhh....I see..... 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
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?

#### alexapaula

Thanks you, helped me a lot, but I can not marry you because I am man ... kkkkk