How we calculate growth rate
The growth rate compares a final value with an initial value and expresses the difference as a percentage of the base.
Use the Growth Rate CalculatorFormula
change = final − initial
growth (%) = (change ÷ |initial|) × 100
Variables
- initial
- Value from the reference period (base).
- final
- Value from the most recent period.
Step-by-step calculation
- We calculate the absolute change between the two periods.
- We divide by the base and convert it into a percentage.
Worked example
Inputs
- Initial: 12,000
- Final: 15,600
Calculation
change = 3,600
3,600 ÷ 12,000 = 0.30
Growth of 30% over the period.
Common mistakes
- Very small bases produce huge, uninformative percentages.
- Adding up growth rates from consecutive periods instead of compounding them.
Frequently asked questions
How do I find the average monthly rate from annual growth?
Use compound growth: (1 + rate)^(1/12) − 1, not simple division by 12.
All values are in US dollars (US$). Results are estimates and do not replace professional advice.