Rate Calculation Excel

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Excel Rate & CAGR Calculator

Calculation Results

Understanding Rate Calculation in Excel

In data analysis and finance, determining the rate of growth over time is a fundamental skill. This calculator mimics the manual math behind Excel's RATE or RRI functions to find the Compound Annual Growth Rate (CAGR) or periodic growth rate.

The Excel Rate Formula

While Excel provides built-in functions, the mathematical logic used to calculate the rate between two values over time is:

Rate = ((Ending Value / Beginning Value)^(1 / n)) – 1

Excel Functions for Rate Calculation

  • =RRI(nper, pv, fv): Returns an equivalent interest rate for the growth of an investment.
  • =RATE(nper, pmt, pv, [fv]): Returns the interest rate per period of an annuity.
  • Manual Math: =(End/Start)^(1/Periods)-1.

Step-by-Step Example

Suppose you have a project that started with a value of 500 units and grew to 1,200 units over 4 years. To find the annual growth rate in Excel:

  1. Beginning Value (PV): 500
  2. Ending Value (FV): 1200
  3. Periods (n): 4
  4. Excel Formula: =(1200/500)^(1/4)-1
  5. Result: 0.2447 or 24.47%
function calculateExcelRate() { var start = parseFloat(document.getElementById('startValue').value); var end = parseFloat(document.getElementById('endValue').value); var n = parseFloat(document.getElementById('periods').value); var resultDiv = document.getElementById('rateResult'); var output = document.getElementById('rateOutput'); var formulaInfo = document.getElementById('formulaUsed'); if (isNaN(start) || isNaN(end) || isNaN(n) || n <= 0 || start <= 0) { alert("Please enter valid positive numbers. Beginning value and periods must be greater than zero."); return; } // CAGR Formula: ((FV / PV) ^ (1 / n)) – 1 var rate = (Math.pow((end / start), (1 / n)) – 1); var percentageRate = (rate * 100).toFixed(2); resultDiv.style.display = "block"; resultDiv.style.backgroundColor = "#eafaf1"; resultDiv.style.border = "1px solid #217346"; output.innerHTML = "Growth Rate: " + percentageRate + "% per period"; formulaInfo.innerHTML = "Calculated as: ((" + end + " / " + start + ")^(1 / " + n + ")) – 1"; }

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