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TVM solve for interest rate, revisited
05-13-2022, 10:34 PM
Post: #2
RE: TVM solve for interest rate, revisited
Example:

lua> n,pv,pmt,fv = 10,50,-30,100
lua> pmt/fv, -pmt/pv
-0.3      0.6

Note that rate cannot be below -1 (otherwise, log1p(x) = NaN)
Both rates are valid (exclusive) edges.

lua> lo = loan_rate(n,pv,pmt,fv,-0.3)
lua> hi = loan_rate(n,pv,pmt,fv, 0.6)
lua> for i=1,4 do print(i, lo(), hi()) end
1      -0.28463423878569005      0.5821069833315318
2      -0.28443603391367706      0.5820382979602389
3      -0.28443599888025706      0.5820382968834661
4      -0.28443599888025595      0.5820382968834662

loan_rate() use Newton's method to solve NPMT=0, for x
Both true rates are bound within its edges, as expected.
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RE: TVM solve for interest rate, revisited - Albert Chan - 05-13-2022 10:34 PM



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