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math – Get rate in Excel without using "RATE" command

Posted by: admin April 23, 2020 Leave a comment

Questions:

I have less knowledge in Excel , now I want your help to calculate rate of interest in excel without using RATE command. (so that I can try to convert the formula in php)
This is the code we use in Excel

  • B5= 60
  • B4= 16070
  • B3= 750000
  • B6= 1

    =RATE(B5,B4,-B3,0,B6)*12

It should give a result of “10.75%” as rate.

How can I get the same result without using ‘RATE’ or any other commands?

How to&Answers:

From pgc01’s answer:

Function MyRATE(nper As Integer, pmt As Double, pv As Double, Optional fv As Double = 0, _
                              Optional PaymentEnd As Integer = 0, Optional guess As Double = 0.1)
    Dim a As Double, b As Double, c As Double ' coefficients of the equation
    Dim R As Double, RTmp As Double, i As Integer

    ' Initialize coefficients and R
    R = 1 + guess
    a = (pmt * (1 - PaymentEnd) - pv) / (pv + pmt * PaymentEnd)
    b = (fv - pmt * PaymentEnd) / (pv + pmt * PaymentEnd)
    c = (-pmt * (1 - PaymentEnd) - fv) / (pv + pmt * PaymentEnd)

    ' Iterate
    For i = 1 To 20
        RTmp = R - (R ^ (nper + 1) + a * R ^ nper + b * R + c) / ((nper + 1) * R ^ nper + a * nper * R ^ (nper - 1) + b)
        If Abs(RTmp - R) < 0.0000001 Then Exit For
        R = RTmp
    Next i

    If i <= 20 Then
        MyRATE = RTmp - 1
    Else
        MyRATE = "N/A" ' Must try another guess
    End If
End Function

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Note:

This is not my code. I have not tested it over a full range of inputs.

EDIT#1:

This is a User Defined Function. User Defined Functions (UDFs) are very easy to install and use:

  1. ALT-F11 brings up the VBE window
  2. ALT-I
    ALT-M opens a fresh module
  3. paste the stuff in and close the VBE window

If you save the workbook, the UDF will be saved with it.
If you are using a version of Excel later then 2003, you must save
the file as .xlsm rather than .xlsx

To remove the UDF:

  1. bring up the VBE window as above
  2. clear the code out
  3. close the VBE window

To use the UDF from Excel worksheet cell:

=myrate(B5,B4,-B3,0,B6)*12

To learn more about macros in general, see:

http://www.mvps.org/dmcritchie/excel/getstarted.htm

and

http://msdn.microsoft.com/en-us/library/ee814735(v=office.14).aspx

and for specifics on UDFs, see:

http://www.cpearson.com/excel/WritingFunctionsInVBA.aspx

Macros must be enabled for this to work!