The relative decrease (change). Definition:
The relative decrease (change) is the difference in an indicator over two periods in time, v1 - v2, relative to the value of the indicator in the earlier period, v1.
- Namely:
- v1 - is called the reference value (original, initial number);
- v2 - is called the new value (the end value).
- In our case: v1 = 10,000, v2 = - 13.9.
The relative decrease (change). Formula:
The relative decrease (change) =
The actual change / |v1|
(v1 - v2) / |v1| =
- Legend:
- v1 - the original number
- |v1| - the positive value of v1, |v1| >= 0. By example: |10| = 10; |-10| = 10.
- v2 - the new value
- The actual change = v1 - v2
- / - the fraction bar (division)
Why do we use |v1| in the formula instead of v1?
- Let's see what happens if we use v1 instead of |v1|:
- Choose a random negative number as the initial value: - 39.
- Choose a random positive number for the end value: 74.
Formula and calculation:
(v1 - v2) / v1 =
(- 39 - 74) / - 39 =
-113 / - 39 ≈
2.897435897436 ≈
2.9
Although the absolute difference is negative: -113, the relative decrease (change) is positive: 2.9. By using |v1| instead of v1, the error is corrected.
The relative percent decrease (change). Detailed calculations below
By multiplying a number by the fraction 100/100,
we change only the form of the result, not the result.
- 100/100 = 100% = 100 ÷ 100 = 1.
- n × 100/100 = (n × 100)/100 = (n × 100)%, any number.
The relative percent decrease (change). Formula:
The relative percent decrease (change) =
The relative decrease (change) × 100/100 =
(The relative decrease (change) × 100)/100 =
(The relative decrease (change) × 100)%
Calculate the relative percent decrease (change):
(10,000 - (- 13.9))/|10,000| =
(10,000 + 13.9)/|10,000| =
10,013.9/10,000 =
10,013.9 ÷ 10,000 =
10,013.9 ÷ 10,000 × 100/100 =
(10,013.9 × 100 ÷ 10,000)/100 =
(1,001,390 ÷ 10,000)/100 =
100.139/100 =
100.139% ≈
100.14%
(Rounded off to max. 2 decimal places)
The relative percent decrease (change)
from the original, initial value 10,000 to the final, end value - 13.9:
Not rounded = 100.139%
Rounded off to max. 2 decimal places ≈ 100.14%
The absolute (actual) difference
10,000 + 13.9 = 10,013.9
The relative percent decrease (change) is positive,
so we really have a relative percent decrease
(the value goes down).