Enter the initial value, step increase percentage, and the number of steps into the calculator to determine the final value after the incremental increases.
Step Increase Formula
The following formula is used to calculate the final value after a series of step increases:
FV = IV * (1 + (SP / 100))^N
Variables:
- FV is the final value after all step increases
- IV is the initial value before any increases
- SP is the step increase percentage
- N is the number of steps
To calculate the final value, multiply the initial value by one plus the step increase percentage divided by 100, raised to the power of the number of steps.
What is a Step Increase?
A step increase is a method of incrementally increasing a value by a fixed percentage over a series of steps. This is often used in financial planning, such as calculating compound interest, or in scenarios where growth or decay occurs at a consistent rate over time.
How to Calculate a Step Increase?
The following steps outline how to calculate the final value after a step increase:
- First, determine the initial value (IV).
- Next, determine the step increase percentage (SP).
- Next, determine the number of steps (N).
- Use the formula FV = IV * (1 + (SP / 100))^N to calculate the final value (FV).
- 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.
Initial Value (IV) = $100
Step Increase Percentage (SP) = 5%
Number of Steps (N) = 3
