The GROWTH function is a built-in function of Microsoft Excel. Besides, we can use this function in financial statistics, regression analysis, and predicting target revenues. Furthermore, it is a worksheet function in Excel, which means we can use this function in combination with other functions in Excel. In this article, I will discuss the details of this function. Moreover, I will show you some applications of the GROWTH function.
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Introduction to Excel GROWTH Function
The GROWTH function is a statistical function in Excel. This function is used to calculate predictive exponential growth for a given set of data. The GROWTH function uses the equation:
y = b*ex
Where b is the y-intercept of the curve. And, m is the slope parameter of the curve, which can also be written as:
GROWTH(known_ys, [known_xs], [new_xs], [const])
|known_ys||Required||This is the set of known y values.|
|known_xs||Optional||This is the set of known x values. If this parameter is not given, the formula uses (1,2,3..) as the known_xs parameter. If a user provides this argument, it should be of the same length as the set of known_ys.|
|new_xs||Optional||It is the x values that are used to return the corresponding y values.|
|const||Optional||This is either a TRUE or FALSE value. TRUE indicates that the constant b is calculated normally. Here, FALSE means that the constant b is set to 1, and the m-values are adjusted so that y = mx. If this parameter is not given, the formula assumes the constant parameter as TRUE.|
- Return Value
The GROWTH function returns numbers in an exponential growth trend matching known data points. This function returns y values for a series of new x values that we specify using existing x values and y values.
- Available in Version
Office 365, Excel 2019, Excel 2016, Excel 2013, Excel 2011 for Mac, Excel 2010, Excel 2007, Excel 2003, Excel XP, Excel 2000.
4 Examples to Use Excel GROWTH Function
1. Calculate Growth Between Two Data Range Using Excel GROWTH Function
Suppose, we have a dataset containing two data ranges (X Values and Y Values). So, now, we will calculate the growth between these two data ranges using the GROWTH function.
- First, type the below formula in Cell E5.
- As a result, we will get the growth of X Values as below:
2. Excel GROWTH Function to Predict Year-wise Revenue
Often, the GROWTH function is used to predict revenue/sales growth yearly or monthly. For instance, we have a dataset containing a company’s year-wise revenue. Now, we will calculate the revenue for the year: 2018.
- Initially, type the following formula in Cell E13.
- Next, hit Enter. Lastly, you will get the growth of the revenue for 2018.
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3. Combination of Excel ROUND and GROWTH Functions
In Method 2, we have calculated the growth of the year 2018, which is $278,542.71. Later, if you want to round this revenue value to zero decimal place, you can use the ROUND function in Excel. So, here are the steps involved in the method.
- First, type the below formula in Cell E13.
Here, the ROUND function rounds the result of the GROWTH formula ($278,542.71) to zero decimal place.
- As a consequence, the approximate revenue of the year 2018 is $278,542.
4. Apply GROWTH Function As an Array in Excel
In this example, we will calculate the growth for a range of x-values. For example, we have a dataset containing the revenue from year: 2010-2015. Now, we will calculate the growth for the next 3 years (2016-2018). However, you have to enter the function to complete the calculation. So, let’s go through the process.
- First, type the below formula in Cell C11.
- Finally, you will get the growth of revenue for the year: 2016, 2017, and 2018.
➤ In Microsoft 365, simply writing the GROWTH formula will serve the purpose. But, in other versions of Excel, you have to press CTRL + SHIFT + Enter to execute the formula as an array function. Here, the curly brackets indicate about the function is executed as an array.
Things to Remember
Be careful with the syntax of the GROWTH function while using it. Because, if you type the wrong syntax, the formula will return errors. So, let’s see some common errors related to this function:
- #REF! – When the [known_xs] range length is not similar to known_ys.
- #NUM! – When the value of known_ys. Is less than or equal to zero.
- #VALUE! – When the value of known_ys, [known_xs], [new_xs] is supplied as text or the values are non-numeric.
In conclusion, it is clear that the GROWTH function is very effective in calculating predictive exponential growth. In the above article, I have tried to discuss the methods elaborately. Hopefully, these methods and explanations will be enough to solve your problems. Please let me know if you have any queries.