"Bruno Campanini" wrote:
I suppose the interest rates 6.25, 7.63, 8.9, 10 and 8
are effective annual rates to be converted in effective
infra-annual rates as follows:
i2 = (1+0.0625)^(1/2)-1 FV = 5000(1+i2)^24
i4 = (1+0.0763)^(1/4)-1 FV = 5000(1+i4)^24
i12 = (1+0.089)^(1/12)-1 FV = 5000(1+i12)^120
i365 = (1+0.1)^(1/365)-1 FV = 5000(1+i365)^1095
[....]
These calculations may differ from the Excel's ones.
In fact Excel uses the standard US banking calculations
which take into account bank profits instead of
mathematical principles.

That assertion is patently incorrect. In fact, FV(i2,24,0,-5000) returns
exactly the same result as 5000*(1+i2)^24. The same is true for the other
three examples.

The standard Excel financial functions (PV, FV, NPER, PMT and RATE) do not
take any "standard US banking" practices into account, much less
calculations based on "bank profits instead of mathematical principles".

Users of those functions might, however. As I noted: "there are two
schools of thought on how to convert an annual rate to a periodic rate. You
need to do it according to the method used by the particular investment.
Sometimes that is dictated by regional law".

I cannot say the same with impunity about Excel bond functions (e.g. YIELD
and PRICE). They might or might not rely on some US-specific bond
conventions. Honestly, I don't know since I am not familiar with bond
conventions the world over.

In any case, I am quite sure that any such US-specific bond conventions are
not motivated by "bank profits instead of mathematical principles". More
likely, they were developed in pre-computer times in order to make
computations easier to do by hand or with a mechanical calculator using
predetermined tables.