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Interest rates calculation in certain ordinary annuities
(IOP Publishing, 2019)
Certain annuities are annuities whose payments occur on fixed dates; while a certain ordinary annuity is one in which payments are made at the end of each established period. The calculation of the interest rate, which governs the certain ordinary annuity, involves the use of a non-analytical equation that requires the application of numerical techniques to obtain the value of the aforementioned rate. The literature indicates that any of these techniques requires one or several numerical values for initialization, which generally are estimated ...
Newton-Raphson method initialization for non-analytical equations solution linked to anticipated annuities
(IOP Publishing, 2019)
The series of payments made in equal intervals of time is known, in the world of
financial mathematics, as an annuity. An anticipated annuity is one whose periodic payment
expires at the beginning of the established payment interval. The non-analytical equation that
allows us to calculate the interest rate, linked to the anticipated annuity, can be solved using
several numerical methods, in particular, the numerical method called Newton-Rhapson. The
main problem with this method is its initialization, which requires of one starting point ...