#1
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PMT Formula
Hello,
I am getting bad results from the PMT function and don't know waht is wrong. The example in the HELP area returns a -$888.89. Why? -$888.89=PMT(8,10,1000,0,1) Last edited by OneOleGuy; 03-03-2011 at 02:58 PM. |
#2
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Hi,
I assume you should be using an interest rate of 8% per annum not 8 (which would be 800%)? Code:
=PMT(8%,10,1000,0,1) Result, each payment is = -£137.99 Last edited by Colin Legg; 03-04-2011 at 06:05 AM. |
#3
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PMT Formula
Thanks for the information, Colin.
When I did it with the % sign in the formula, I didn't expect a negative value to be returned. Thank you for your aid. Bill |
#4
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don't you have to divide the 8% by the number of payments per year (for example 12 for monthly payments, or maybe it would be 10 for this short loan) to convert it from annual rate (APR) to rate per period?
=PMT(8%/12,10,1000,0,1) If you dont like the result being a neg number, you can convert the PV to a negative number... =PMT(8%/12,10,-1000,0,1) |
#5
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Hi Bill,
Quote:
Quote:
But now I look in the Excel helpfile, I see that example 1 does indeed demonstrate a 10-monthly payment loan at 8% and that is probably what the OP was referring to, albeit the principal in the helpfile is 10,000 as opposed to 1,000. Thanks for pointing that out. |
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