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 = 1.2, v2 = 504.9.
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: - 89.
- Choose a random positive number for the end value: 98.
Formula and calculation:
(v1 - v2) / v1 =
(- 89 - 98) / - 89 =
-187 / - 89 ≈
2.101123595506 ≈
2.1
Although the absolute difference is negative: -187, the relative decrease change is positive: 2.1. 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:
(1.2 - 504.9)/|1.2| =
- 503.7/1.2 =
- 503.7 ÷ 1.2 =
- 503.7 ÷ 1.2 × 100/100 =
(- 503.7 × 100 ÷ 1.2)/100 =
(- 50,370 ÷ 1.2)/100 =
- 41,975/100 =
- 41,975%
The relative percent decrease change
from the original, initial value 1.2 to the final, end value 504.9:
= - 41,975%
The absolute (actual) difference
1.2 - 504.9 = - 503.7
By what percentage has 1.2 decreased?
Answer: By - 41,975%
By what percentage is 504.9 smaller than 1.2?
Answer: By - 41,975%
The relative percent decrease change is negative,
so in this case we really have a relative percent increase instead
(the value goes up).