How to Calculate Percent Change
The formula used for calculating the percent increase or decrease is as follows:
| % Change | = | ( | V2 - V1 | ) | 100 |
| V1 |
Where V1 is the starting number and V2 is the ending number
Percentage Increase Example
To see how the percent change formula works, let's suppose you wanted to calculate the percent change in the cost of attending college from the previous year. If the tuition last year was $5,000, and tuition this year is $5,500, here is how you would calculate the percent increase in college tuition:
| % Chg. | = | ( | 5500 - 5000 | ) | 100 |
| 5000 |
| % Chg. | = | ( | 500 | ) | 100 |
| 5000 |
| % Chg. | = | 0.10 * 100 |
| Change | = | 10% Increase |
Percentage Decrease Example
On the other hand, let's suppose tuition last year was $5,500, and tuition this year is $5,000 (I know, wishful thinking), here is how you would calculate the percent decrease in college tuition:
| % Chg. | = | ( | 5000 - 5500 | ) | 100 |
| 5500 |
| % Chg. | = | ( | -500 | ) | 100 |
| 5500 |
| % Chg. | = | -0.0909 * 100 |
| Change | = | -9.09%, or a 9.09% Decrease |
If you are wondering why a 500 increase results in a higher percentage change (10%) than a 500 decrease (9.09%) in the above example, it's because the denominator in the percentage change formula is always greater in the case of a percentage decrease (higher of the two numbers is the divisor).
I hope my explanation has solidified your understanding of how to calculate percent change. If not, please use the feedback form beneath the calculator to let me know what questions I have left unanswered.
