Interest rate required for a capital to reach a given future value when placed for a duration of N years formula

Tags: interest rates methodology time value of money

Description of the Interest rate required for a capital to reach a given future value when placed for a duration of N years formula

Formula allowing the calculation of the interest rate at which a given capital has to be placed for a duration of N in order to reach a future value of K_N

Formula

i = 100 \times ({(\frac{K_{N}}{K_{0}})}^{\frac{1}{N}} - 1)

Symbols

K_{N}

Future value of the capital

K_{0}

Present value of the capital

N

Number of periods (years)

Additional information related to this formula

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