Percentage Change

In this topic, we are going to discuss the concepts of percentage change. We see percentage change in our everyday life. From the increase in price to decrease in price, from more discounts, there is a change in percentage everywhere.

Percentage Change

The change in the value of product refers to as the amount of percentage change in the product. In percentage whenever the value of measured changes, the change can be captured in two ways. They are:

1. Absolute value change
2. Percentage change
Both these terms have their advantages as well as disadvantages.

1. Absolute Value Change

Absolute value change refers to the actual change in the measured quantity. It means the direct change in the product. For example, if the sales of the product in 1st year is 200 crore and in the second year it 220 crores, then the absolute value of the change will be 100 crores.

2. Percentage Change

This change in percentage can be obtained through the following formula.

Percentage change = Absolute value change/ original quantity x 100

= 20/200 x 100 = 10%

It is important to note here that the percentage change calculations are usually calculated on the original quantity unless it is mentioned in the question.

We will understand the concept of percentage change through some examples.

Example Based on Population

Q. The population of a city grew from 40 lakh to 44 lakh. Find the
a) percentage change
b) percentage change based on the final value of the population.

Here, we are required to find two things. First, we need to find the change in percentage from 40 to 44, then based on the final value we need to find the percentage change.

Change in percentage = absolute value change/ original quantity x 100
The increase in population is 4 lakh and the original population was 40 lakh. So, the change in percentage = 4/40 x 100 = 20%.

Now, we are required to find the change in percentage but the base should be final value.

Change in percentage = 4/44 x 100 = 9.09%.