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 = 1,219, v2 = 1,183.2.
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: - 92.
- Choose a random positive number for the end value: 19.
Formula and calculation:
(v1 - v2) / v1 =
(- 92 - 19) / - 92 =
-111 / - 92 ≈
1.20652173913 ≈
1.21
Although the absolute difference is negative: -111, the relative decrease (change) is positive: 1.21. 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):
(1,219 - 1,183.2)/|1,219| =
35.8/1,219 =
35.8 ÷ 1,219 =
35.8 ÷ 1,219 × 100/100 =
(35.8 × 100 ÷ 1,219)/100 =
(3,580 ÷ 1,219)/100 ≈
2.936833470057/100 =
2.936833470057% ≈
2.94%
(Rounded off to max. 2 decimal places)
The relative percent decrease (change)
from the original, initial value 1,219 to the final, end value 1,183.2:
Rounded off to max. 12 decimal places ≈ 2.936833470057%
Rounded off to max. 2 decimal places ≈ 2.94%
The absolute (actual) difference
1,219 - 1,183.2 = 35.8
The relative percent decrease (change) is positive,
so we really have a relative percent decrease
(the value goes down).