Calculation of unknown interest rate
Input(s)
F: Amount to be Payed After End of \(t\) Years (currency unit)
P: Amount Borrowed (money)
\(\mathrm{t}\): Time at Which F Needs to be Payed (years)
Output(s)
i: Interest Rate (fraction)
Formula(s)
\[
\mathrm{i}=\exp \left(\frac{\ln \left(\frac{\mathrm{F}}{\mathrm{P}}\right)}{\mathrm{t}}\right)-1
\]
Reference(s)
Mian, M. A. 2011. Project Economics and Decision Analysis Volume 1: Deterministic Models, Second Edition. Tulsa, Oklahoma: PennWell Corporation. Chapter 2, Page: 65.