Internal Rate of Return and Corresponding Effective Interest Rate for Loans
Session
Management, Business and Economics
Description
In this paper some techniques for calculating the internal rate of return (IRR) for several types of loans offered by banks and other micro financial institutions, and their respective effective interest rates are shown. Some examples of calculating the internal rate of return for loans without a fee, and those with fees are given and the effective interest rate for those loans is calculated. The mathematical model for calculation of the internal rate of return and the effective interest rate is shown. For accurate calculations the financial consultant CASIO FC -100V is used.
Keywords:
nominal interest rate, periodical interest rate, internal rate of return (IRR), effective interest rate, fee
Session Chair
Besnik Skenderi
Session Co-Chair
Sema Kazazi
Proceedings Editor
Edmond Hajrizi
ISBN
978-9951-437-54-7
Location
Durres, Albania
Start Date
28-10-2017 11:00 AM
End Date
28-10-2017 12:30 PM
DOI
10.33107/ubt-ic.2017.260
Recommended Citation
Limani, Ramadan, "Internal Rate of Return and Corresponding Effective Interest Rate for Loans" (2017). UBT International Conference. 260.
https://knowledgecenter.ubt-uni.net/conference/2017/all-events/260
Internal Rate of Return and Corresponding Effective Interest Rate for Loans
Durres, Albania
In this paper some techniques for calculating the internal rate of return (IRR) for several types of loans offered by banks and other micro financial institutions, and their respective effective interest rates are shown. Some examples of calculating the internal rate of return for loans without a fee, and those with fees are given and the effective interest rate for those loans is calculated. The mathematical model for calculation of the internal rate of return and the effective interest rate is shown. For accurate calculations the financial consultant CASIO FC -100V is used.