Yes it would be the point at which the initial cost would appear to have
doubled, but your explanation does not even remotely resemble what you
asked. Now we are beginning to see what you actually want. Now, does the
owner have to pay for this installation? If so then there is the cost
of the money to install it. If you ignore the cost of money, you can
also ignore the inflation side. Now the number of years will be equal to
the annual electrical cost divided into the initial cost of the
equipment. If on the other hand you want to plug inflation in, you
must also allow for the cost of the money for the initial purchase. At
that point the pay back becomes longer, as the money cost is invariably
greater than inflation. So the question is what is the real time to
offset the cost of purchase when the real costs and savings are allowed
for? I suggest you outline all the items that need to be accounted for,
and then the math expression can be written.

Eric wrote:

Isn't that when the value would double? This has nothing to do with when it
will double. A1 is the investment cost and the "first year value" is a
totally different number.

Here is what I am doing. We are a Solar Electric Contrator, by installing
solar on your home we can wipe out your electric bill. I want to know how
long it will take until the cost of the Solar Electric system (the value in
A1) will equal the electricity that they would have been paying assuming that
electricity increases 4% each year over the past year. We know our customers
current year cost of electricity and cost of Solar Electric system.

"Bob I" wrote:


At 4 % the number will be a tad over 17 years. Unless of course, this is
one of those "magic money" schemes, and then the number of years becomes
whatever the mark will believe.

Eric wrote:


Sorry about all the confusion, I'll try it again.

If there is a 4% increase each year over the previous year, how many years
it will take until the sum of the years will equal A1

The values I will input are "initial year cost" and A1

I am looking to calculate the value of each year (the first year being user
defined) and then add all the years together until they equal the value in
A1. The Returned value should be something like 8.2 years.

Thank You for your help, patience and expertise,

Eric

"Fred Smith" wrote:



Eric, you need to define your problem much better. Barb gave you an excellent
response based on your first request. Also, you need to understand future value
better, it's "Amount*(1.04^n)", not "Year1^(1.04*n)".

So, it's over to you. Define your problem, preferably with an example which
shows which result you want. You will get an answer.

--
Regards,
Fred


"Eric" wrote in message
...


I can't make sense of what you wrote.
Also, I need to make sure that the calculated value is the sum of each year
including interest. This should be calculated by adding year1 + year2 + year3
etc
year2 and up should be calculated by =Year1^(1.04*n) where n = the year#

"Barb Reinhardt" wrote:



It should make no difference what the initial year is (I think)

THis is your equation

Initial Value * 1.04^n = 2* Initial Year

Solve for n (which is the # of hears

1.04^N = 2
n log 1.04 = log 2
n = log 2/log 1.04
N = 17.67 years.

If the interest rate changes, your result will change.

HTH,
Barb Reinhardt

"Eric" wrote:



Hello everyone,

I am trying to create a forumla to show pay back time.

If there is a 4% increase each year over the previous year, how many years
it will take until the accrued years will equal A1

The values I will input are "initial year" and A1