Revenue = $100,000 × (1 + 0.25) = $100,000 × 1.25 = $125,000

Wed, 29 Apr 2026 21:47:40 +0000

Understanding Revenue Growth: How a $100,000 Base Becomes $125,000 with a 25% Increase When analyzing business performance, one of the most fundamental calculations is understanding revenue growth. A common scenario businesses encounter is a direct increase of 25% on a current revenue figure. Take the example: Revenue = $100,000 × (1 + 0.25) = $100,000 × 1.25 = $125,000. This formula reveals how a 25% growth transforms a stable $100,000 into a stronger $125,000. ### Why Revenue Multiplication Matters The equation Revenue = $100,000 × 1.25 = $125,000 isn’t just a simple math exercise—it’s a powerful illustration of how percentages translate into real financial outcomes. By multiplying the base revenue by 1.25 (which equals 1 plus 0.25), businesses instantly visualize growth beyond flat earnings. This multiplication approach is widely used in sales forecasting, budget planning, and investment analysis.