## Cross Rates w/ Compounding Growth

Nov 04

In managerial accounting, we learn that sales is a function of price and volume, and that the growth of both sales and volume are not additive, but rather multiplicative (i.e., geometric). The product of their growth rates is known as a cross rate, and can be derived by the following formula: Sales = Price × Volume, and Sales Growth =[ ( 1 + Price Growth Rate) × (1...

Read More