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 = 80, v2 = 39.2.
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: - 33.
- Choose a random positive number for the end value: 4.
Formula and calculation:
(v1 - v2) / v1 =
(- 33 - 4) / - 33 =
-37 / - 33 ≈
1.121212121212 ≈
1.12
Although the absolute difference is negative: -37, the relative decrease change is positive: 1.12. 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:
(80 - 39.2)/|80| =
40.8/80 =
40.8 ÷ 80 =
40.8 ÷ 80 × 100/100 =
(40.8 × 100 ÷ 80)/100 =
(4,080 ÷ 80)/100 =
51/100 =
51%
The relative percent decrease change
from the original, initial value 80 to the final, end value 39.2:
= 51%
The absolute (actual) difference
80 - 39.2 = 40.8
By what percentage has 80 decreased?
Answer: By 51%
By what percentage is 39.2 smaller than 80?
Answer: By 51%
The relative percent decrease change is positive,
so we really have a relative percent decrease
(the value goes down).