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which financial function should I use?
Thanks - didn't have PV negative!
"joeu2004" wrote: On Nov 22, 5:34 am, Ken W wrote: I only have an investment and future value and number of periods - no annual payments are made [...]. It returns "#NUM". I changed the guess around alot, but it hasn't helped. If you have only the two data points, you should use RATE. Remember to enter the initial investment and future value with opposite signs. For example, =RATE(5,0,-1000,2000). If the #NUM error persists, yes, it could be because you need to provide a guess. Unfortunately, it is often difficult to choose a good guess. Also remember that RATE returns a result in terms of the number of periods. In my example above, if 5 is years, RATE is an annual rate; but if 5 is months, RATE is a monthly rate. You can convert a monthly rate to an annual rate in two ways: =12*RATE(5,0,-1000,2000) =(1 + RATE(5,0,-1000,2000))^12 - 1 It is debatable which formula to use; it depends on your intent. The latter compounds the rate. |
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