AI Tutor
A market worth $10 billion sounds massive, but if its total sales drop by 20% every single year, launching a startup there could be financial suicide.
Market growth is the percentage change in the total size of a market over a specific period of time.
Analysts track growth in two distinct ways: by value (total revenue in dollars) or by volume (the total number of physical units sold).
How do we convert raw historical sales figures into a clean percentage that lets us compare different industries?

The Growth Rate Formula

To calculate the rate of growth, we measure the change in market size relative to where the market started.
Multiplying the change by 100 turns a decimal fraction into a standard percentage, allowing investors to compare a tiny boutique sector with a global industry.
Let's see how this works with real sales figures from an expanding market.

Worked Example: Positive Growth

Suppose the electric bike market was valued at 120million∗∗in2022andexpandedto∗∗120 million** in 2022 and expanded to **150 million in 2023.