Calculation of unknown interest rate

Input(s)

F: Amount to be Payed After End of $t$ Years (currency unit)

P: Amount Borrowed (money)

$\mathrm{t}$: Time at Which F Needs to be Payed (years)

Output(s)

i: Interest Rate (fraction)

Formula(s)

$$ \mathrm{i}=\exp \left(\frac{\ln \left(\frac{\mathrm{F}}{\mathrm{P}}\right)}{\mathrm{t}}\right)-1 $$

Reference(s)

Mian, M. A. 2011. Project Economics and Decision Analysis Volume 1: Deterministic Models, Second Edition. Tulsa, Oklahoma: PennWell Corporation. Chapter 2, Page: 65.