The net growth rate (NGR) measures the overall growth of a company, product, or investment over a period. You calculate it by subtracting the beginning value from the ending value, dividing the result by the beginning value, and then multiplying by 100 to express the answer as a percentage.
Here's the formula:
*NGR = ((Ending Value - Beginning Value) / Beginning Value) 100**
Examples:
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Company Revenue: If a company's revenue was $1 million at the beginning of the year and $1.2 million at the end, the NGR would be:
((1.2 million - 1 million) / 1 million) * 100 = 20%
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Investment Growth: If you invested $10,000 and it grew to $12,000 after a year, the NGR would be:
((12,000 - 10,000) / 10,000) * 100 = 20%
Practical Insights:
- The NGR can be used to compare the performance of different companies, products, or investments.
- A positive NGR indicates growth, while a negative NGR indicates a decline.
- It's important to consider the time period over which the NGR is calculated, as a higher NGR over a shorter period may not be as impressive as a lower NGR over a longer period.
Solutions:
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To calculate the NGR in Microsoft Excel, you can use the following formula:
=(Ending Value - Beginning Value) / Beginning Value * 100 -
Many online calculators are available to calculate the NGR. Simply search for "net growth rate calculator" on the internet.
