Question

Solve for the unknown interest rate in each of the following

Present Value				Years		Interest Rate		Future Value
	$	220		4		%		$	270
		340		18					986
		37,000		19					169,819
		36,261		25					481,638

Answer 1

F		=	P*(1+i)^n			Where,
						P	Present value
						F	future value
						i	interest rate
						n	years
1)	F		=	P*(1+i)^n			Where,
	270		=	220*(1+i)^4			P	$       220
	1.227		=	(1+i)^4			F	$       270
	1.227^(1/4)		=	1+i			i	?
	1.0525		=	1+i			n	4
	i		=	0.0525
	or Interest rate is		5.25%
2)	F		=	P*(1+i)^n			Where,
	986		=	340*(1+i)^18			P	$       340
	2.900		=	(1+i)^18			F	$       986
	2.900^(1/18)		=	1+i			i	?
	1.060935		=	1+i			n	18
	i		=	0.0609
	or Interest rate is		6.09%
3)	F		=	P*(1+i)^n			Where,
	169819		=	37000*(1+i)^19			P	$   37,000
	4.590		=	(1+i)^19			F	$1,69,819
	4.590^(1/19)		=	1+i			i	?
	1.0835083		=	1+i			n	19
	i		=	0.0835
	or Interest rate is		8.35%
4)	F		=	P*(1+i)^n			Where,
	$4,81,638		=	36261*(1+i)^25			P	$   36,261
	13.283		=	(1+i)^25			F	$4,81,638
	13.283^(1/25)		=	1+i			i	?
	1.1090		=	1+i			n	25
	i		=	0.1090
	or Interest rate is		10.90%