1. What is Project Growth Rate?

The Project Growth Rate measures the annualized percentage return on investment for a project, comparing the net benefits (benefits minus costs) relative to the initial costs over the project duration.

2. How Does the Calculator Work?

The calculator uses the growth rate formula:

Where:

• \( Benefits \) — Total project benefits in USD
• \( Costs \) — Total project costs in USD
• \( Duration \) — Project duration in years

Explanation: The formula calculates the percentage return per year, accounting for both the net gain and the time period.

3. Importance of Growth Rate Calculation

Details: Growth rate helps evaluate project profitability, compare investment options, and assess whether returns justify the costs and risks.

4. Using the Calculator

Tips: Enter all values as positive numbers. Costs must be greater than zero. Duration must be at least 0.1 years.

5. Frequently Asked Questions (FAQ)

Q1: What's a good growth rate for projects?
A: This varies by industry, but generally rates above 10-15% are considered good, depending on risk and alternative investments.

Q2: How does this differ from ROI?
A: ROI gives total return, while growth rate annualizes the return, making multi-year projects comparable to annual investments.

Q3: Should I include all project costs?
A: Yes, include both direct and indirect costs for accurate calculation.

Q4: What if my project has ongoing costs?
A: For complex cash flows, consider using Net Present Value (NPV) or Internal Rate of Return (IRR) calculations.

Q5: Can this be used for personal investments?
A: Yes, the same calculation works for evaluating personal investment growth over time.