Explorations of problems of Growth With the Spreadsheet

by

John R. Simmons

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In this exploration we want to see how large will a penny grow in value if its value is doubled each day for 29 days. The Spreadsheet is used as a utility tool to obtain the results.

As can be seen from the spreadsheet and chart, above starting with just one penny and doubling the amount each day for 29 days result in a total amount of \$5,368,709.12. If we start with two pennies (the second column) the amount is doubled to \$10,737,418.24. The power of compounding is enormous.

We now turn our attention to a more realistic example. Let say we start with an investment of \$10,000. The money is deposited into an account which yields an 8% annual return (See the spreadsheet below). After 9 years with no additional deposits, the amount has essentially doubled. In twenty years, the initial investment of \$10,000 has grown to more than \$46,000.00. How about that?

Here we display a graph of the data for the spreadsheet above.