Enter the future value, present value, and number of periods into the calculator to determine the catch-up growth rate. This calculator can also evaluate any of the variables given the others are known.
Catch Up Growth Formula
The following formula is used to calculate the catch-up growth.
CG = (FV - PV) / (n * PV)
Variables:
- CG is the catch-up growth rate (%)
- FV is the future value or target value ($)
- PV is the present value or current value ($)
- n is the number of periods (years, months, etc.)
To calculate the catch-up growth rate, subtract the present value from the future value. Then, divide the result by the product of the number of periods and the present value. The result is the catch-up growth rate per period.
What is a Catch Up Growth?
Catch Up Growth refers to a period of accelerated growth experienced by an organism, economy, or individual to compensate for a previous period of delayed or slowed growth. This phenomenon is often observed in children who have experienced malnutrition or illness, but later exhibit a rapid increase in height and weight once their health improves. Similarly, in economics, it refers to a period of rapid economic growth in a country or region following a period of stagnation or decline.
How to Calculate Catch Up Growth?
The following steps outline how to calculate the Catch Up Growth rate:
- First, determine the future value or target value (FV) ($).
- Next, determine the present value or current value (PV) ($).
- Next, determine the number of periods (n).
- Next, gather the formula from above = CG = (FV - PV) / (n * PV).
- Finally, calculate the Catch Up Growth rate.
- After inserting the variables and calculating the result, check your answer with the calculator above.
Example Problem :
Use the following variables as an example problem to test your knowledge.
future value or target value (FV) ($) = 5000
present value or current value (PV) ($) = 3000
number of periods (n) = 5
