Convert a lease money factor to an equivalent annual interest rate or APR, reverse the conversion, and estimate monthly lease finance charges.

Required: lease money factor as a decimal, such as 0.00250. The equivalent annual percentage is the solve target.

Interest Rate From Money Factor Formula

The following two example problems outline the steps and information needed to calculate the Interest Rate From Money Factor.

IR = MF * 2,400
  • Where IR is the Interest Rate From Money Factor (% APR)
  • MF is the money factor 

To calculate the interest rate from money factor, multiply the money factor by 2400.

Money Factor to Interest Rate (APR) Conversion Table
Money Factor Interest Rate (% APR)
0.000100.24
0.000250.60
0.000421.01
0.000501.20
0.000831.99
0.001002.40
0.001253.00
0.001503.60
0.001754.20
0.001904.56
0.002004.80
0.002255.40
0.002506.00
0.002756.60
0.003007.20
0.003257.80
0.003508.40
0.003759.00
0.004009.60
0.0045010.80
* Rounded to 5 decimals (Money Factor) and 2 decimals (APR). Formula: APR (%) ≈ Money Factor × 2400; Money Factor ≈ APR (%) ÷ 2400.

How to Calculate Interest Rate From Money Factor?

The following example problems outline how to calculate Interest Rate From Money Factor.

Example Problem #1:

  1. First, determine the money factor.
    • The money factor is given as: .025.
  2. Finally, calculate the Interest Rate From Money Factor using the equation above: 

IR = MF * 2,400

The values provided above are inserted into the equation below and computed.

IR = .025 * 2,400 = 60 (% APR)

Example Problem #2: 

For this problem, the variables required are provided below:

money factor = .15

${V2} = ${number 4}

Test your knowledge using the equation and check your answer with the calculator..

IR = MF * 2,400 = ?