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How to Find Relative Percent Change

Here you will learn about the calculation of percentage change. You might have heard that the prices of housing has risen by $20$ %, but what does it actually mean when people say that something has risen or fallen by a certain percentage?

This type of increase or decrease is called a percentage change. The answer to the question asked above is then: The price for housing at two different times are compared, and the change in price is converted to a percentage relative to the original price. This is what you will learn here.

You want to compare old value to new value and find the percentage change. Have a look at the formula written below.

Formula

Percentage change

% change = \frac{new value - old value}{old value}

If you get a positive number, something has grown in value.

If you get a negative number, something has declined in value.

Example 1

You bought a Playstation for $$ 320$ . You decided to sell it two years later. You sold it for $$ 175$ . What was the percentage change?

The percentage change is:

\begin{array}{l} \frac{175 - 320}{320} & \approx - 0.453 \\ = - 45.3 % \end{array}

This means that the change in value was $- 45.3 %$ . You got a negative percentage, meaning that the Playstation declined in value. It has fallen by $45.3 %$ in value.