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How to calculate Compound growth

The Compound growth formula, with plain worked examples you can check yourself.

Compound growth = P × (1 + r)ⁿ

Worked examples

P = 1000 · r = 30% · n = 3Compound growth = 2,197
P = 1000 · r = 10% · n = 3Compound growth = 1,331
P = 1000 · r = 30% · n = 2Compound growth = 1,690

How to use it

  1. Write down the values for each letter in the formula.
  2. Do the brackets first, then divide or multiply.
  3. Check the units before you compare results.
  4. Compare the answer with last period or with a competitor to see if it is good or bad.

This formula belongs to Money & Prices.

Related terms

InflationPrice elasticityDeflationMonetary policyMoney supplyCentral bank

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