The formula
is the original value and the new one. A positive result is an increase, a negative one a decrease.
Where it comes from
A percentage is a fraction scaled so the whole is 100. A change is measured against where you started, so the starting value is the whole:
Multiplying by 100 turns the fraction into a percentage. Going the other way, a change of adds of the original:
The absolute value in the denominator handles negative starting values, so a move from −10 to −15 reads as a 50% decrease rather than an increase.
Worked example
A price rises from 80 to 92:
Watch out for
- Up and back down isn’t zero. A 50% rise followed by a 50% fall leaves you at 75% of where you started, because the second change is measured from a bigger base.
- Percent vs percentage points. An interest rate going from 2% to 3% is a 1 percentage point rise, but a 50% increase.
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