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excelexcel-formulalibreoffice-calc

Understanding a basic XLS formula: percentage and exponential

Sorry, this is as basic as it gets.

However, I have trouble with understanding the math behind this Excel formula:

=((X*(1+1%)^25)*12*25)

X is a cell reference. Can someone illuminate me what's the math? I can't understand how that percentage works and the associativity...

When X=97.5 the result is 37511.

Solution

  • If you don't understand a formula, break it down into parts and apply BODMAS, Brackets, Order, Division and Multiplication, Addition and Subtraction.

    • (1+1%) is evaluated first, this equals 101% or 1.01
    • Next you take 1.01 to the power of 25 which is 1.2824.....
    • X multiplied by 1.2824.... which if X = 97.5 you get 125.037.....
    • List item Lastly you multiply this by 12 (= 1500.4454....), then 25, you get 35711.135....

    The power (order) of 25 is done before the multiplication as it's within the same set of brackets as the multiplication and Order takes precedence over Multiplication.