How can you calculate the CAGR (Compounded Annual Growth Rate)?
Say I have 2 numbers and corresponding dates as follows;
1999 - $10000
2003 - $25000
How can I determine the compounded growth from just this information?
Bruce
How can you calculate the CAGR (Compounded Annual Growth Rate)?
Say I have 2 numbers and corresponding dates as follows;
1999 - $10000
2003 - $25000
How can I determine the compounded growth from just this information?
Bruce
It's the final number divided by the earlier number raised to the power of 1
over the number of annual periods. Subtract 1 from that result to get the
CAGR. In your case, assuming that both the amounts are beginning of period,
the formula would be
=25000/19000^(1/4) - 1
"Bruce" <[email protected]> wrote in message
news:[email protected]...
> How can you calculate the CAGR (Compounded Annual Growth Rate)?
>
> Say I have 2 numbers and corresponding dates as follows;
>
> 1999 - $10000
>
> 2003 - $25000
>
> How can I determine the compounded growth from just this information?
>
> Bruce
Thanks both of you. They both work. Is there an excel function to calc
compound rates? I remember coming across this some time ago but cannot seem
to find it in the help now...
"Duke Carey" wrote:
> It's the final number divided by the earlier number raised to the power of 1
> over the number of annual periods. Subtract 1 from that result to get the
> CAGR. In your case, assuming that both the amounts are beginning of period,
> the formula would be
>
> =25000/19000^(1/4) - 1
>
> "Bruce" <[email protected]> wrote in message
> news:[email protected]...
> > How can you calculate the CAGR (Compounded Annual Growth Rate)?
> >
> > Say I have 2 numbers and corresponding dates as follows;
> >
> > 1999 - $10000
> >
> > 2003 - $25000
> >
> > How can I determine the compounded growth from just this information?
> >
> > Bruce
>
>
>
not that I know of. But RATE gives the rate for periodic payments.
Mangesh
"Bruce" <[email protected]> wrote in message
news:[email protected]...
> Thanks both of you. They both work. Is there an excel function to calc
> compound rates? I remember coming across this some time ago but cannot
seem
> to find it in the help now...
>
> "Duke Carey" wrote:
>
> > It's the final number divided by the earlier number raised to the power
of 1
> > over the number of annual periods. Subtract 1 from that result to get
the
> > CAGR. In your case, assuming that both the amounts are beginning of
period,
> > the formula would be
> >
> > =25000/19000^(1/4) - 1
> >
> > "Bruce" <[email protected]> wrote in message
> > news:[email protected]...
> > > How can you calculate the CAGR (Compounded Annual Growth Rate)?
> > >
> > > Say I have 2 numbers and corresponding dates as follows;
> > >
> > > 1999 - $10000
> > >
> > > 2003 - $25000
> > >
> > > How can I determine the compounded growth from just this information?
> > >
> > > Bruce
> >
> >
> >
Yes using RATE function you can get the CAGR as followis: -
=rate(4,0,-10000,25000)
=25.74%
"Mangesh Yadav" <[email protected]> wrote in message
news:%[email protected]...
> not that I know of. But RATE gives the rate for periodic payments.
>
> Mangesh
>
>
>
> "Bruce" <[email protected]> wrote in message
> news:[email protected]...
>> Thanks both of you. They both work. Is there an excel function to calc
>> compound rates? I remember coming across this some time ago but cannot
> seem
>> to find it in the help now...
>>
>> "Duke Carey" wrote:
>>
>> > It's the final number divided by the earlier number raised to the power
> of 1
>> > over the number of annual periods. Subtract 1 from that result to get
> the
>> > CAGR. In your case, assuming that both the amounts are beginning of
> period,
>> > the formula would be
>> >
>> > =25000/19000^(1/4) - 1
>> >
>> > "Bruce" <[email protected]> wrote in message
>> > news:[email protected]...
>> > > How can you calculate the CAGR (Compounded Annual Growth Rate)?
>> > >
>> > > Say I have 2 numbers and corresponding dates as follows;
>> > >
>> > > 1999 - $10000
>> > >
>> > > 2003 - $25000
>> > >
>> > > How can I determine the compounded growth from just this information?
>> > >
>> > > Bruce
>> >
>> >
>> >
>
>
=RATE(4,0,-10000,25000)
--
Kind Regards,
Niek Otten
Microsoft MVP - Excel
"Mangesh Yadav" <[email protected]> wrote in message
news:%[email protected]...
> not that I know of. But RATE gives the rate for periodic payments.
>
> Mangesh
>
>
>
> "Bruce" <[email protected]> wrote in message
> news:[email protected]...
>> Thanks both of you. They both work. Is there an excel function to calc
>> compound rates? I remember coming across this some time ago but cannot
> seem
>> to find it in the help now...
>>
>> "Duke Carey" wrote:
>>
>> > It's the final number divided by the earlier number raised to the power
> of 1
>> > over the number of annual periods. Subtract 1 from that result to get
> the
>> > CAGR. In your case, assuming that both the amounts are beginning of
> period,
>> > the formula would be
>> >
>> > =25000/19000^(1/4) - 1
>> >
>> > "Bruce" <[email protected]> wrote in message
>> > news:[email protected]...
>> > > How can you calculate the CAGR (Compounded Annual Growth Rate)?
>> > >
>> > > Say I have 2 numbers and corresponding dates as follows;
>> > >
>> > > 1999 - $10000
>> > >
>> > > 2003 - $25000
>> > >
>> > > How can I determine the compounded growth from just this information?
>> > >
>> > > Bruce
>> >
>> >
>> >
>
>
There are currently 1 users browsing this thread. (0 members and 1 guests)
Bookmarks