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 = 4,132,775.12, v2 = 3,920,167.08.
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: - 68.
- Choose a random positive number for the end value: 63.
Formula and calculation:
(v1 - v2) / v1 =
(- 68 - 63) / - 68 =
-131 / - 68 ≈
1.926470588235 ≈
1.93
Although the absolute difference is negative: -131, the relative decrease change is positive: 1.93. 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:
(4,132,775.12 - 3,920,167.08)/|4,132,775.12| =
212,608.04/4,132,775.12 =
212,608.04 ÷ 4,132,775.12 =
212,608.04 ÷ 4,132,775.12 × 100/100 =
(212,608.04 × 100 ÷ 4,132,775.12)/100 =
(21,260,804 ÷ 4,132,775.12)/100 ≈
5.14443766783/100 =
5.14443766783% ≈
5.14%
(Rounded off to max. 2 decimal places)
The relative percent decrease change
from the original, initial value 4,132,775.12 to the final, end value 3,920,167.08:
Rounded off to max. 12 decimal places ≈ 5.14443766783%
Rounded off to max. 2 decimal places ≈ 5.14%
The absolute (actual) difference
4,132,775.12 - 3,920,167.08 = 212,608.04
By what percentage has 4,132,775.12 decreased?
Answer: By ≈ 5.14%
By what percentage is 3,920,167.08 smaller than 4,132,775.12?
Answer: By ≈ 5.14%
The relative percent decrease change is positive,
so we really have a relative percent decrease
(the value goes down).