?
Solved

Interest rate function

Posted on 2000-05-16
3
Medium Priority
?
165 Views
Last Modified: 2010-04-04
has anybody got an example of using the interestrate function found in Math.pas.
The other financial functions work fine but when using the interestrate function my answer is different to what I would expect.
Thanks in advance
0
Comment
Question by:eldraco
3 Comments
 
LVL 3

Expert Comment

by:sburck
ID: 2816361
From the Delphi bug list:


  Reported by Karl Thompson
  InterestPayment gives wrong results; InterestRate causes Exceptions.
  Karl has provided sample code with which the bugs can be reproduced.
  Jean-Claude Valitchek has looked into these bugs and found that:

       function InterestPayment() calls function PaymentParts() where var T3 goes from negative to zero then positive for a calculation from the first to the last period, which is wrong...!

       function InterestRate():
       As described in the unit (not in the HELP!), First and last payments must be non-zero and of OPPOSITE SIGNS. When this is applied, the function works.

Hope this helps.

0
 
LVL 15

Accepted Solution

by:
simonet earned 200 total points
ID: 2843525
>From the Delphi bug list:

There are no bugs in the InterestRate function in Delphi. People who reported it in the bug list have never done accounting or financial calcs using paper and pencil... or even an HP-48G.

The InterestRate function returns the value exactly as expected, and they match the results of the Financial solver of my HP-48GX exactly. The problem most people have is interpreting the results.

If you do what the InterestRate function does on the paper, using the conventional formulas, you'll also find opposite signs for PV and FV or PMT.

For more info on how to use the InterestRate function, please see:

http://www.experts-exchange.com/jsp/qShow.jsp?ta=delphi&qid=10356437 
      - or -
http://www.experts-exchange.com/Q.10356437 (non-cookie login)

(it's a 5 pts question, but this function has been extensively discussed and the expect results have been found using the InterestRate function and some financial background).

>my answer is different to what I would expect.


You are probably expecting an interest rate in %/year.

The InterestRate function returns the rate in the time basis of the payment you entered. So, supposed you passed 60 as the number of payments, and you do consecutive monthly payments, then, that is 60 months, and the function will return the Interest rate in months. In order to have the yearly interest rate, multiply it by 12 (and then by 100 to have it in %).

This has all been explained in the thread I mentioned.

Yours,

Alex
0
 

Author Comment

by:eldraco
ID: 2843578
Answer accepted
0

Featured Post

Industry Leaders: We Want Your Opinion!

We value your feedback.

Take our survey and automatically be enter to win anyone of the following:
Yeti Cooler, Amazon eGift Card, and Movie eGift Card!

Question has a verified solution.

If you are experiencing a similar issue, please ask a related question

Creating an auto free TStringList The TStringList is a basic and frequently used object in Delphi. On many occasions, you may want to create a temporary list, process some items in the list and be done with the list. In such cases, you have to…
Hello everybody This Article will show you how to validate number with TEdit control, What's the TEdit control? TEdit is a standard Windows edit control on a form, it allows to user to write, read and copy/paste single line of text. Usua…
this video summaries big data hadoop online training demo (http://onlineitguru.com/big-data-hadoop-online-training-placement.html) , and covers basics in big data hadoop .
The Relationships Diagram is a good way to get an overall view of what a database is keeping track of. It is also where relationships are defined. A relationship specifies how two tables connect to each other. As you build tables in Microsoft Ac…
Suggested Courses
Course of the Month12 days, 15 hours left to enroll

578 members asked questions and received personalized solutions in the past 7 days.

Join the community of 500,000 technology professionals and ask your questions.

Join & Ask a Question