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.
- Where:
- v1 - is called the reference value (original, initial number);
- v2 - is called the new value (the end value).
- In our case: v1 = 400, v2 = 143.
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: - 29.
- Choose a random positive number for the end value: 21.
Formula and calculation:
(v1 - v2) / v1 =
(- 29 - 21) / - 29 =
-50 / - 29 ≈
1.724137931034 ≈
1.72
Although the absolute difference is negative: -50, the relative decrease change is positive: 1.72. 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:
(400 - 143)/|400| =
257/400 =
257 ÷ 400 =
257 ÷ 400 × 100/100 =
(257 × 100 ÷ 400)/100 =
(25,700 ÷ 400)/100 =
64.25/100 =
64.25%
The relative percent decrease change
from the original, initial value 400 to the final, end value 143:
= 64.25%
The absolute (actual) difference
400 - 143 = 257
By what percentage has 400 decreased?
Answer: By 64.25%
By what percentage is 143 smaller than 400?
Answer: By 64.25%
The relative percent decrease change is positive,
so we really have a relative percent decrease
(the value goes down).