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Compound Annual Growth Rate

Compound annual growth rate is a business- and investing-specific term for the geometric progression ratio that provides a constant rate of return over the time period.

Compound annual growth rate increases as the ratio between the final investment value and initial investment value increases and as the time horizon decreases.

Formula

QuantityVariable["CAGR", "Unitless"] == -1 + (QuantityVariable[Subscript["V", "f"], "Money"]/QuantityVariable[Subscript["V", "i"], "Money"])^(Quantity[1, "Years"]/QuantityVariable["T", "Time"])

symbol description physical quantity
CAGR compound annual growth rate "Unitless"
Vf final investment value "Money"
Vi investment "Money"
T time horizon "Time"

Forms

Examples

Get the resource:

In[1]:=
ResourceObject["Compound Annual Growth Rate"]
Out[1]=

Get the formula:

In[2]:=
FormulaData[ResourceObject["Compound Annual Growth Rate"]]
Out[2]=

Use some values:

In[3]:=
FormulaData[ ResourceObject["Compound Annual Growth Rate"], {QuantityVariable[ \!\(\*SubscriptBox[\("V"\), \("f"\)]\),"Money"] -> Quantity[200, "USDollars"], QuantityVariable["T","Time"] -> Quantity[3, "Years"], QuantityVariable["CAGR","Unitless"] -> Quantity[25.99`, "Percent"]}]
Out[3]=

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