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 = 4,123, v2 = 2,234.7.
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: - 27.
- Choose a random positive number for the end value: 63.
Formula and calculation:
(v1 - v2) / v1 =
(- 27 - 63) / - 27 =
-90 / - 27 ≈
3.333333333333 ≈
3.33
Although the absolute difference is negative: -90, the relative decrease change is positive: 3.33. 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:
(4,123 - 2,234.7)/|4,123| =
1,888.3/4,123 =
1,888.3 ÷ 4,123 =
1,888.3 ÷ 4,123 × 100/100 =
(1,888.3 × 100 ÷ 4,123)/100 =
(188,830 ÷ 4,123)/100 ≈
45.799175357749/100 =
45.799175357749% ≈
45.8%
(Rounded off to max. 2 decimal places)
The relative percent decrease change
from the original, initial value 4,123 to the final, end value 2,234.7:
Rounded off to max. 12 decimal places ≈ 45.799175357749%
Rounded off to max. 2 decimal places ≈ 45.8%
The absolute (actual) difference
4,123 - 2,234.7 = 1,888.3
By what percentage has 4,123 decreased?
Answer: By ≈ 45.8%
By what percentage is 2,234.7 smaller than 4,123?
Answer: By ≈ 45.8%
The relative percent decrease change is positive,
so we really have a relative percent decrease
(the value goes down).