All Questions
Tagged with finance algebra-precalculus
203
questions
1
vote
1
answer
56
views
How to solve for monthly interest rate given principal, number of payments, and total payment
The problem:
A lottery winner is given two payment options: Receive 131 million dollars in 25 yearly installments of equal size, the first payable immediately, or receive a single immediate payment of ...
- 31
0
votes
1
answer
60
views
How to evaluate $(1-aP)^P=d$ for P where $P>0$ and a & d are known
For context I am working trying to work out a formula based on the payout annuity formulas.
With these forums I have been able to derive the expected term for a given payment:
Standard payout annuity ...
- 11
3
votes
1
answer
159
views
Is it possible for interest to = principal for all and each installments?
In practice, there are two main amortization methods used by and large for retail mortgages:
The classical amortization formula where all installments have the same value, however the interest % and ...
- 33
0
votes
1
answer
80
views
Optimal portfolio weight derivation.
I cannot see how to derive the following optimal portfolio weight $w^*$:
$$
w^*
=
\frac
{(b - \frac{1}{2}) \rho \sigma_1\sigma_2 - b\sigma_2^2 +\sigma_1\sigma_2\sqrt{(b - \frac{1}{2})^2\rho^2 + b(1-b)}...
- 141
11
votes
5
answers
2k
views
Why using compound interest formula gives (potentially) wrong answer in this instance
I was doing some catch up exercise on Khan academy and was given this seemingly simple looking problem
Find the compound interest and the total amount after 4 years and 6 months if the interest is ...
- 113
0
votes
0
answers
37
views
Determine the value of the monthly payment if the sum of $5000$ is paid in the last year
The company wishes to sell its car for $23000$ usd cash. A client who wants the car offers to make semi-annual payments with a rate of $11.5\%$ with semi-annual capitalization, the first at the end of ...
- 100
0
votes
1
answer
86
views
Finding the Rate of Decrease to End Up at Goal Number [closed]
I'm trying to find the Rate of decrease at which 1,262 is multiplied by every day (16 times in total) and added to the Base number of 17,584 in total 16 times to get to the goal number of 24,000. I've ...
- 11
1
vote
1
answer
190
views
Is the weighted average interest rate (aka WACC) strictly less than or equal to the combined value of the interest on those investment kept seperate?
When combining multiple loans with separate interest rates into one interest rate, is it possible to reason about if the resulting interest rate will always be less than that of the combined ...
- 113
0
votes
1
answer
31
views
Correct calculation of assets profit and loss
I would like to make some profit and loss calculations based on the market prices.
Scenario 1 (profit):
Given a crypto is worth $1500. I've made a purchase for <...
- 103
-2
votes
1
answer
44
views
How get the cost price? [closed]
I have the following spreadsheet:
For column B, the formula is simple: B1 + (B1 * A2)
The question is: how to get the numbers in column C?
I manually typed all values on column C but the idea is if I ...
- 105
-1
votes
1
answer
83
views
How is there a convergent limit in this simple formula? [closed]
All details are in the attached picture. Please refer to it.
Here are some examples I calculated with different first year operating margins(in case it might help you):
Example #1: When terminal year ...
- 11
0
votes
1
answer
845
views
Rearranging Annuity formula
Can someone please show me how this is rearranged/simplified from this: PV = CF[(1-(1+r)^-n)/r] to PV= CF(1/r)[1-(1/((1+r)^n)] with steps, will help me wrap my head around it.
Also, how does it go ...
- 1
5
votes
4
answers
850
views
Why does compound interest exist?
Background
My understanding is that compound interest arises in the following way:
The bank offers its clients some interest rate $r$ on an account with principal $P$ that yields $rP$ after some time $...
- 5,679
0
votes
3
answers
695
views
Compound interest formula is not understandable
I am struggling to understand the formula for compound interest. More specifically what the $n$ stands for.
The formula is as follows according to the wikipedia:
$$
A = P(1 + \frac{r}{n})^{nt}
$$
...
0
votes
1
answer
507
views
$\$9000$ is invested in a account offering $3\%$ per year, compounded continuously, how fast (in dollars/yr) is the balance growing after $4$ years?
If $\$9000$ is invested in a savings account offering $3\%$ per year, compounded continuously, how fast (in dollars/yr) is the balance growing after $4$ years? (Round your answer to the nearest cent)
...
- 1,502