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Percent Increase Formula:
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Percent increase measures how much a quantity has grown relative to its original value, expressed as a percentage. It's commonly used to track growth rates, price changes, performance improvements, and other comparative measurements.
The formula for calculating percent increase is:
Where:
Explanation: The formula calculates the difference between the new and old values, divides by the original value to get the relative change, then multiplies by 100 to convert to a percentage.
Common Applications: Percent increase is used in finance (investment returns, price changes), business (sales growth), statistics (population growth), science (experimental results), and everyday comparisons (salary increases).
Example 1: If a product's price increases from $50 to $75:
(75 - 50)/50 × 100 = 50% increase
Example 2: If a company's revenue grows from $1M to $1.3M:
(1.3 - 1)/1 × 100 = 30% increase
Q1: What if the old value is zero?
A: Percent increase is undefined when the old value is zero because you cannot divide by zero. In such cases, absolute change may be more appropriate.
Q2: How is percent increase different from percentage points?
A: Percent increase measures relative change from an original value, while percentage points measure absolute differences between percentages.
Q3: Can percent increase be negative?
A: Yes, if the new value is less than the old value, the result will be negative, indicating a percent decrease.
Q4: How do you calculate compound percent increase?
A: For multiple periods, use the formula: Final Value = Initial Value × (1 + r)^n, where r is the rate and n is the number of periods.
Q5: What's the difference between percent increase and growth factor?
A: Percent increase shows the percentage change, while growth factor is the multiplier (e.g., 1.5 for a 50% increase).