Compounding Monthly Growth

PrevContributor
PrevContributor
in Modeling

Relatively new user and am struggling to build a ramping growth model based on monthly expansion.  Am using the lag function in this context:   Avg Deal Size = LAG(Avg Deal Size, -1, AEC Salesperson Assumptions.Starting Deal Size) * (1 + Deal Size Growth)   My Deal Size Growth is positive and my overall Avg Deal Size is shrinking which isn't intuitive.  Any help here would be very much appreciated.

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Answers

  • ravi
    ravi

    Have you tried the PREVIOUS function instead? I am assuming the timescale on the module is 'Month'. 
    Avg Deal Size = PREVIOUS(Avg Deal Size) * (1 + Deal Size Growth)

  • ablack
    ablack

    Hi, I noticed you have a "-1" in your lag function--the LAG function is n periods in the PAST therefore -1 = +1 month ahead.  Double negative.

     

    Hi Ravi, with PREVIOUS you lose overflow, which it why LAG is desirable in this scenario.

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