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Percentage change calculation

The percentage change from old value (V_old) to new value (V_new) is equal to the old and new values difference divided by the old value times 100%:

percentage change = (V_new - V_old) / V_old × 100%

Example #1

Price percentage increase from old value of $1000 to new value of $1200 is caluclated by:

percentage change = ($1200 - $1000) / $1000 × 100%

 = 0.2 × 100% = 20%

Example #2

Price percentage decrease from old value of $1000 to new value of $800 is caluclated by:

percentage change = ($800 - $1000) / $1000 × 100%

 = -0.2 × 100% = -20%

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Percentage change (increase/decrease) calculation - free explanation

Percentage change calculation is a valuable tool for anyone involved in business, finance, or economics. This simple calculation allows you to determine the percentage change in a value over time, giving you valuable insights into trends and patterns. The calculation for percentage change is relatively straightforward. You first need to determine the initial value and the final value, and then subtract the initial value from the final value. This will give you an absolute change in value.

To determine the percentage change, divide the absolute change by the initial value and multiply by 100.

For example, let's say that a company had revenue of $100,000 in the first quarter of the year and $120,000 in the second quarter.

To calculate the percentage change in revenue, we first subtract the initial value from the final value: $120,000 - $100,000 = $20,000. This gives us an absolute change in revenue.

To determine the percentage change, we divide the absolute change by the initial value: $20,000 / $100,000 = 0.2

Finally, we multiply by 100 to get the percentage change: 0.2 x 100 = 20%

Therefore, the percentage change in revenue between the first and second quarters was 20%.

While this calculation may seem simple, it can provide valuable insights into trends and patterns over time. For example, a company may use percentage change calculations to determine the growth rate of its revenue, profits, or customer base over time. This can help identify areas where the company is succeeding and areas where it may need to make improvements. In addition to calculating percentage changes over time, there are other applications of percentage change calculations. For example, you can use percentage change calculations to determine the percentage increase or decrease in prices or quantities. This can be useful for businesses that need to adjust their prices or inventory levels based on market conditions. Another application of percentage change calculations is in finance, particularly in calculating returns on investments. By calculating the percentage change in the value of an investment over a period of time, you can determine the rate of return on that investment.

This can be helpful for investors who need to evaluate the performance of their investments and make decisions about future investments. Overall, the percentage change calculation is a versatile tool that can be applied in many different contexts. Whether you are a business owner, economist, or investor, understanding how to calculate percentage changes can provide valuable insights into trends and patterns over time.