The difference between real and nominal profit

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Simple or nominal is the rate of profit, not taking into account the impact of inflation. Over time, inflation partially or completely reduces the purchasing power of money. It can be noted that 1,000 rubles today is far from equal to 1,000 rubles thirty years ago.

To account for the time value of a currency, the discounting method can be used. When taking into account the impact of inflation, we are talking about the real (inflation-adjusted) colombia mobile phone numbers databaserate of return.

Profitability and CAGR
These concepts are closely related. CAGR shows the average annual rate of return on investment over a period of more than 12 months, taking into account the growth values ​​of the indicator for different periods.

To obtain CAGR you need:

divide the final cost of the investment by its initial value;

subtract from this result the value increased to the power of the inverse number of periods.

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Reporting for monitoring business profitability
To closely monitor financial performance, manage effectively and increase profitability, it is necessary to analyze the data presented in various reports.

Operating Profit and Loss Statement
This report displays the company's income and expenses for a certain period of time (year, quarter, month), allowing management to draw conclusions about the financial condition of the business and make appropriate decisions to increase its profitability.