To calculate the Monthly Growth Rate:
\[ m = \left(1 + \frac{a}{100}\right)^{\frac{1}{n}} - 1 \]
Where:
The annual growth rate to monthly conversion is a method used to determine the equivalent monthly growth rate from a given annual growth rate. This is useful in financial planning, investment analysis, and business forecasting where growth rates are often expressed on an annual basis, but decisions need to be made on a monthly basis. The conversion helps in understanding how an annual growth rate translates into monthly increments, allowing for more granular analysis and planning.
Let's assume the following values:
Step 1: Calculate the monthly growth rate:
\[ m = \left(1 + \frac{12}{100}\right)^{\frac{1}{12}} - 1 \approx 0.009488 \text{ or } 0.9488\% \]
So, the Monthly Growth Rate is approximately 0.9488%.
Let's assume the following values:
Step 1: Calculate the monthly growth rate:
\[ m = \left(1 + \frac{24}{100}\right)^{\frac{1}{12}} - 1 \approx 0.0182 \text{ or } 1.82\% \]
So, the Monthly Growth Rate is approximately 1.82%.
