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Compound Annual Growth Rate Formula

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Compound Annual Growth Rate is a measure of the geometric progression ratio that provides a constant rate of return over a specified time period. Check FAQs

CAGR = (({(\frac{EV}{SV})}^{\frac{1}{n y}}) - 1) \cdot 100

CAGR - Compound Annual Growth Rate?EV - Ending Value?SV - Starting Value?n_y - Number of Years to Track Growth?

Compound Annual Growth Rate Example

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With units

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Here is how the Compound Annual Growth Rate equation looks like with Values.

Here is how the Compound Annual Growth Rate equation looks like with Units.

Here is how the Compound Annual Growth Rate equation looks like.

10.7566 = (({(\frac{25000}{15000})}^{\frac{1}{5}}) - 1) \cdot 100

10.7566 = (({(\frac{25000}{15000})}^{\frac{1}{5}}) - 1) \cdot 100

10.7566 = (({(\frac{25000}{15000})}^{\frac{1}{5}}) - 1) \cdot 100

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Compound Annual Growth Rate Solution

Follow our step by step solution on how to calculate Compound Annual Growth Rate?

FIRST Step Consider the formula

CAGR = (({(\frac{EV}{SV})}^{\frac{1}{n y}}) - 1) \cdot 100

Next Step Substitute values of Variables

∴

CAGR = (({(\frac{25000}{15000})}^{\frac{1}{5}}) - 1) \cdot 100

Next Step Prepare to Evaluate

∴

CAGR = (({(\frac{25000}{15000})}^{\frac{1}{5}}) - 1) \cdot 100

Next Step Evaluate

∴

CAGR = 10.756634324829

LAST Step Rounding Answer

∴

CAGR = 10.7566

Compound Annual Growth Rate Formula Elements

Variables

Compound Annual Growth Rate

Compound Annual Growth Rate is a measure of the geometric progression ratio that provides a constant rate of return over a specified time period.

Symbol: CAGR

Measurement: NAUnit: Unitless

Note: Value should be greater than 0.

Formulas to find Compound Annual Growth Rate

Ending Value

Ending Value is the value of the investment or metric at the end of the specified period.

Symbol: EV

Measurement: NAUnit: Unitless

Note: Value should be greater than 0.

Formulas to find Ending Value

Starting Value

Starting Value is the initial value of the investment or metric at the beginning of the period.

Symbol: SV

Measurement: NAUnit: Unitless

Note: Value should be greater than 0.

Formulas to find Starting Value

Number of Years to Track Growth

Number of Years to Track Growth is the total number of years over which the growth occurred.

Symbol: n_y

Measurement: NAUnit: Unitless

Note: Value should be greater than 0.

Formulas to find Number of Years to Track Growth

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How to Evaluate Compound Annual Growth Rate?

Compound Annual Growth Rate evaluator uses Compound Annual Growth Rate = (((Ending Value/Starting Value)^(1/Number of Years to Track Growth))-1)*100 to evaluate the Compound Annual Growth Rate, The Compound Annual Growth Rate formula is defined as a metric used to measure the geometric progression ratio that provides a constant rate of return over a specified time period. Compound Annual Growth Rate is denoted by CAGR symbol.

How to evaluate Compound Annual Growth Rate using this online evaluator? To use this online evaluator for Compound Annual Growth Rate, enter Ending Value (EV), Starting Value (SV) & Number of Years to Track Growth (n_y) and hit the calculate button.

FAQs on Compound Annual Growth Rate

What is the formula to find Compound Annual Growth Rate?

The formula of Compound Annual Growth Rate is expressed as Compound Annual Growth Rate = (((Ending Value/Starting Value)^(1/Number of Years to Track Growth))-1)*100. Here is an example- 10.75663 = (((25000/15000)^(1/5))-1)*100.

How to calculate Compound Annual Growth Rate?

With Ending Value (EV), Starting Value (SV) & Number of Years to Track Growth (n_y) we can find Compound Annual Growth Rate using the formula - Compound Annual Growth Rate = (((Ending Value/Starting Value)^(1/Number of Years to Track Growth))-1)*100.

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Compound Annual Growth Rate Formula

Compound Annual Growth Rate Example

Compound Annual Growth Rate Solution

Compound Annual Growth Rate Formula Elements

Other formulas in Financial Metrics category

How to Evaluate Compound Annual Growth Rate?

FAQs on Compound Annual Growth Rate

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