GEOMEAN49 returns 6. The geometric mean return calculates the average return for the investments which are compounded on the basis of its frequency depending on the time period and it is. The arithmetic mean would be 4 92 65.
Rn growth rate for year N.
The long-hand calculation would be. The arithmetic mean would be 4 92 65. In the example shown GEOMEAN is used to calculate a compound annual growth rate. The general formula for the geometric mean of n numbers is the nth root of their product.