Enter the present value, future value, and number of years an asset of investment has been growing into the calculator below to determine the growth rate in % per year.
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Growth Rate Percent Formula
The following formula is used by the calculator above to determine the growth rate in percent of a value over time.
x(t) = x0 × (1 + r) t
Where r is the growth rate in percent. This equation can further be simplified to the following:
r = (x(t) – x0)^ 1/t – 1
- Were X(t) is the final value
- X0 is the initial value
- t is time in years
Growth Rate Definition
A growth rate is the rate of increase of a value. In other words, what percentage a value increases per time period.
How to calculate a growth rate?
How to calculate a growth rate percent
- First, determine the initial final values
This will be the values at time t=0.
- Next, measure the time elapsed.
After the time has passed, measure the final value.
- Finally, calculate the growth rate percent.
Enter the values from step 1 and 2 into the formula to calculate the growth rate percent.
A growth rate percent is percentage increase of an exponential function. That is the rate increase of a value over each unit of time.
Absolutely, a negative growth rate equation will yield values that approach 0 but never reach it.