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From Luc Maisonobe <Luc.Maison...@free.fr>
Subject Re: commons-math usage to calculate APR?
Date Sat, 16 Aug 2008 21:45:07 GMT
```David Hoffer a écrit :
> My usage is for USA only at this point.
>
> I have inputs of loanAmount, monthlyInterestRate, numberMonths, loanFees; so
> this would be for fixed monthly payments.

You can try this (considering monthlyInterestRate is a number between
0.0 and 1.0, i.e. percent values have already been divided by 100.0, and
considering the loanFees are fixed monthly fees):

public double getMonthlyPayment(final double loanAmount,
final double monthlyInterestRate,
final int numberMonths,
final double loanFees) {
final double f = Math.pow(1 + monthlyInterestRate, numberMonths);
return loanFees + monthlyInterestRate * f * loanAmount / (f - 1);
}

Could you compute the APR from this monthly payment ?

Luc

>
> I understand that commons-math doesn't have specific finance methods however
> I think the APR formula is a non-linear equation that I was hoping
> commons-math could help solve.
>
> -Dave
>
> -----Original Message-----
> From: Luc Maisonobe [mailto:Luc.Maisonobe@free.fr]
> Sent: Saturday, August 16, 2008 2:45 PM
> To: Commons Users List
> Subject: Re: commons-math usage to calculate APR?
>
> David Hoffer a écrit :
>> Can anyone point me to an example of how to use commons-math to calculate
>> APR (Annual Percentage Rate)?
>
> There are no specific finance related algorithm in commons-math.
>
>> I think this is solvable using either the NewtonSolver or BisectionSolver
>> but I am not sure how to accomplish this.  Perhaps a different way is
>> better.
>
> I think so, but it depends on what you really need. APR computation
> seems to be slightly different depending on local regulations (for
> example USA or EU). It also depends on the assumptions you do and the
> input data. For example you can compute it one way for fixed monthly
> payments and another way for varying monthly payments.
>
>> Any help would be greatly appreciated.
>
> Could you explain your needs more precisely ?
>
> Luc
>
>> Thanks.
>>
>>
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