How to solve for X?
- Thread starter alekrabbe
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As far as I can see, there is no "simple algebraic" solution. You can only approximate values of 'x' through numerical approximations.
Thank you for replying, the formula presented is used in finances to calculate the future value (y) based on a fixed monthly deposit (z) a period of time (n) and a interest rate (x). I was able to isolate z so I could calculate how much money is needed monthly on a fixed interest rate (x) at a fixed period (n) to reach a certain goal (y).
However, I would also like to know what would be the interest rate (x) needed to reach a goal (y) having a fixed period (n) and a fixed monthly deposit (z).
Hope I managed to explain myself and what I am trying to achieve, hence the need to isolate X or find another way to calculate that interest rate. Thank you.
Cubist
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You seem to ignore what @Subhotosh Khan said in post #2. I back it up, there is no simple algebraic solution (except for some special cases for low integer values of n, which probably aren't worth mentioning).
Therefore you'll need to use a numerical approach such as a spreadsheet's "goal seek", Newton-Raphson, or another such approximation. We say approximation because it isn't mathematically exact, like sqrt(2) is only approximately equal to 1.414213562373095. However it is possible to achieve an answer accurate to as many finite decimal points as you like.
Therefore you'll need to use a numerical approach such as a spreadsheet's "goal seek", Newton-Raphson, or another such approximation. We say approximation because it isn't mathematically exact, like sqrt(2) is only approximately equal to 1.414213562373095. However it is possible to achieve an answer accurate to as many finite decimal points as you like.
Thank you for pointing me the direction to look for.
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"to look for" what? If you are still trying to "solve for x", you have not yet been pointed in the right direction, It is not a matter of not being clever enough, it CAN'T be done. Stop Trying. You can solve for any 'x' you need using iterative numerical techniques. Finding the interest rate always has been the last and most difficult piece of simply future/present values and their more convenient formulas. Finding "n" can be a little tricky, as one might be expecting an integer value all the time. That's just a bad assumption; don't expect it and the problem is resolved. That interest rate will not allow for simple discovery.