Step-by-step for how to find percentage increase, with simple examples to explain the mathematical process in easy terms.
Price increases are now part of everyday life in all areas of life. How many percent do you now pay more than before? Knowing how to calculate a percentage increase or percentage increase can be useful in a variety of situations.
You will probably see on the news that often a change is being described in large numbers. But no percentage increase is given to put it in context. If you calculate the percentage increase and find that it is only 2%, you will know that perhaps you don’t have to believe the scare tactics the story is presented with.
How to find percentage increase: method 1
Write down the starting value (or starting value) and the ending value. Suppose your private health insurance premium has just increased. Write down the following values:
- Your health insurance contribution was $500 before the increase. That is the starting point.
- After the climb it costs 5550. That is the final value.
Figure out the increase.
- Subtract the starting value from the ending value to find out how much the contribution has increased. At this point we continue to work with normal numbers, not percentages.
- In our example this results in $550 – $500 = an increase of $50.
- Divide the result by the starting value. A percentage is a type of fraction. For example, “5% of students” is a faster way to say “5 in 100 students”. If you divide the result of the calculation by the initial value, you turn it into a fraction, so to speak, that compares the two values.
- In our example, the result is $50 / $500 = 0.1.
- Multiply the result by 100. This converts the previous value to a percentage.
- The end result in our example is 0.1 x 100 = 10% growth in your private health insurance premium.
Write down the starting and ending values. Let’s do it with a new example. The world population increased from 5,300,000,000 people in 1990 to 7,800,000,000 people in 2020.
There is a trick for questions with many zeros. Instead of counting the zeros at every step, you can rewrite the numbers in 5.3 billion (instead of 5,300,000,000) and 7.8 billion (instead of 7,800,000,000).
- Divide the final value by the initial value. This tells us how much larger the end value is than the start value. So … 7.8 billion ÷ 5.3 billion = around 1.47.
- Multiply by 100. This tells you how big the percentage increase between the two values is. If the value has increased (and not decreased), the result should always be greater than 100.
- 1.4 x 100 = 140%. This means that the world population in 2015 is around 140% of the population in 1990.
- Subtract 100. In this type of problem, 100% is always the starting value. By subtracting this from your result, you get the pure percentage of the increase.
- 140% – 100% = a 40% increase in population.
This works because starting value + increase = end value. If you rearrange the equation, you get increase = final value – initial value.
Difference between percentage increase and absolute increase
The size of the increase is also referred to as the absolute difference, which means the actually described amount. A price increase of $50 for an egg and $50 for a house have the same absolute increase. The percentage increase shows you the relative difference.
This tells how much something has grown compared to the initial value. A $50 increase in the price of an egg is a huge relative increase. Adding $50 to the price of a house is a tiny relative increase.