# How to calculate Interest Rate from Discount Factor?

Question: Given a discount factor of .9671, what is the interest rate? Round to two decimal places.

I thought that would be the Discount Rate which is 0.9671 = 1 / (1+DR), or ~0.34, but that's showing up as an incorrect answer. So how would I go about getting to the Interest Rate?

### 1 Answer

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- BryceLv 71 month agoFavorite Answer
0.9671 = 1 / (1+DR)

1+DR= 1/0.9671≈ 1.0340

DR= 0.0340= 3.40%

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