## How to calculate interest rate given present value and future value in excel

This example teaches you how to calculate the future value of an investment or the present value of an annuity in Excel. Tip: when working with financial functions in Excel, always ask yourself the question, am I making a payment At an annual interest rate of 8%, how much will your investment be worth after 10 years? Discount Factor Table - Provides the Discount Formula and Excel functions for common to $F=$P*(1+i)n after n years, where i is the effective annual interest rate. To convert the future value to the equivalent present value, you simply Uniform Gradient Series Cash Flow (linearly increasing payment amount from G at 29 Jul 2019 With Simple Interest (the opposite of compound interest), interest is only The basic compound interest formula for calculating a future value is F The syntax for the FV function in Excel is FV(rate,nper,pmt,[pv],[type]). Excel 1 Apr 2011 Find out the future value of an investment with the Excel FV Function. Rate = Interest Rate per compound period – in this case a monthly rate (6% per annum / 12 months) You can use the PV function to calculate this:. Present Value Formulas, Tables and Calculators, Calculating the Present Value ( PV) of a Once you determine the PV of 1 factor from the table, simply use it to The interest rate for discounting the future amount is estimated at 10% per year

## Multiply your result by 100 to calculate the interest rate as a percentage. This percentage represents the rate your investment must earn each period to get to your future value. Concluding the example, multiply 0.0576 by 100 for a 5.76 percent interest rate.

29 Jul 2019 With Simple Interest (the opposite of compound interest), interest is only The basic compound interest formula for calculating a future value is F The syntax for the FV function in Excel is FV(rate,nper,pmt,[pv],[type]). Excel 1 Apr 2011 Find out the future value of an investment with the Excel FV Function. Rate = Interest Rate per compound period – in this case a monthly rate (6% per annum / 12 months) You can use the PV function to calculate this:. Present Value Formulas, Tables and Calculators, Calculating the Present Value ( PV) of a Once you determine the PV of 1 factor from the table, simply use it to The interest rate for discounting the future amount is estimated at 10% per year where PV is the present value (= starting principal), FV is the future value, r and CAGR are the annual interest rate, and Y is the number of years invested.

### Understanding the calculation of present value can help you set your to meet a future expense, or a series of future cash outflows, given a specified rate of return . the less money you'll need to save at any interest rate because of the power of Excel spreadsheet you can use a PV formula to do the calculations for you.

For example, if an investment of $10,000 earns an annual interest rate of 4%, the investment's future value after 5 years can be calculated by typing the following formula into any Excel cell: =10000*(1+4%)^5 which gives the result 12166.52902. I.e. the future value of the investment (rounded to 2 decimal places) is $12,166.53. In this equation, the present value of the investment is its price today and the future value is its face value. The number of period terms should be calculated to match the interest rate's period, generally annually. Six months would, therefore, be 0.5 periods. Raise the number your calculated in Step 1 to the 1 divided by the number of years between the current value and the present value. For example, if the future value was predicted for 5 years in the future, you would raise the 1/5 power. Continuing the example, you would raise 1.2 to the 1/5 power and get 1.037. Video of the Day

### To calculate FV, simply press the [CPT] key and then [FV]. Your answer should be exactly $16,315.47. If you're off by a few cents, it is probably because you used fewer decimal places in your periodic interest rate. Now that you've mastered future value, click here to learn How to Calculate Present Value Using Excel or a Financial Calculator.

The NPV function in Excel returns the net present value of an investment based on a discount or interest rate and a series of future cash flows. The syntax of the Excel NPV function is as follows: NPV(rate, value1, [value2], …) Return of your money when compounded with annual percentage return. If you invest your money with a fixed annual return, we can calculate the future value of your money with this formula: FV = PV(1+r)^n. Here, FV is future value, PV is present value, r is the annual return, and n is the number of years. PV is one of the most important financial functions in Excel which calculates (a) the present value of a finite stream of equidistant equal cash flows at a constant interest rate over a specific period or (b) present value of a single cash flow at a specific time in future at constant interest rate. rate - The interest rate per period. nper - The total number of payment periods. pmt - The payment made each period. fv - [optional] A cash balance you want to attain after the last payment is made. If omitted, assumed to be zero. type - [optional] When payments are due. 0 = end of period, 1 = beginning of period. The Excel FV function is a financial function that returns the future value of an investment. You can use the FV function to get the future value of an investment assuming periodic, constant payments with a constant interest rate. the calculated present value of your future value amount PVIF Present Value Interest Factor that accounts for your input Number of Periods, Interest Rate and Compounding Frequency and can now be applied to other future value amounts to find the present value under the same conditions. Period Time period. Typcially a period will be a year but it can be any time interval as long as all inputs are in the same time unit.

## In this equation, the present value of the investment is its price today and the future value is its face value. The number of period terms should be calculated to match the interest rate's period, generally annually. Six months would, therefore, be 0.5 periods.

For example, the above spreadsheet on the right shows the Excel PV function used to calculate the present value of an investment that earns an annual interest rate of 4% and has a future value of $15,000 after 5 years. As shown in cell B4 of the spreadsheet, the PV function to calculate this is: 1. Using the same example we will now find the present value of an investment by using a financial calculator. Before we start, clear the financial keys by pressing [2nd] and then pressing [ FV ]. 2. Now we're ready to enter in all the information from our example.

how to calculate Future value of a data in excel using FV Excel function. returns the future value of the present amount having interest rate over a period.