How does this formula work for percentage increase?

## 3 Answers

Well it should stand to reason that a house that is 7 times bigger is 700% the size, ie, 100% (the original house) + 600%. The number you get is 6, times 100%= 600%.
I think you're a little confused with why 1 and 100% are the same

For that u need to understand the relationship between a fraction value and it's equivalent percentage value

When we say x is (1/2) of y that means x is half the value of y... And it also means x is 50% of the value of y...

When we say something is (1/3) that means it is one third the value... Or in other words we also say it's 33.33% of the value....

So what's the relationship?

The relation is that if something is x%, that means in fraction term it is (x/100)

50% = 50/100 = 1/2

33.33% = 33.33/100 = 1/3 and so on

Similarly if something's value does not change, or in other words x=y, we say x is 100% of y...
So in fraction term it's 100/100 = 1

Now coming to % increase

For that we first understand increase and then move on to increase %

When a value changes from 10 to 15, what's the increase?

The increase is 15-10 = 5 right

So that's technically final value - initial value....

When we need to find increase %, we find the percentage increase on the initial value.. means compared to the initial value what's the increase

In other words we mean to say increase% is:

That if initial value of 10 the increase is of 5

But if the initial value would've been of 100 then what would've been the increase value?
That value is nothing but the value of the increase%

So now let's understand how to derive the formula for increase % through unitary method
I'm hoping you are familiar with unitary method

So when initial value is 10, the increase is 5

When initial value is 1, the increase is 5/10

So if initial value is 100, the increase is (5/10)*100 = 50

And so we say that if the initial value would've been 100, the increase would've been of 50

And that's the formula:

Increase% = ((final -initial)/initial)*100

Now if you check the right hand side

(Final-initial)/initial = final/initial - initial/initial = final/initial - 1(bcoz any value divided by same value gives 1)

So the formula can also be written as

Inc% = ((Final/Initial) - 1)*100

This final/initial is called the Multiplying factor

And (final/initial) -1 is called the increase factor...

So inc% = (final/initial)*100 - 100

That's why we take away the 1 if it's in fraction form OR we take away 100% if it's in % form

Hope this helps....
percent of change = (new – old)/(old)

The change amount is new – old.

You write that over the old amount to get a number representing what percent that change was of the old number.

Example: old = 40, new = 50, change = 50 – 40 = 10, percent of change is 10/40, which is 25/100 or 25%.

Meaning: old amount was 40; 25% of 40 is 10; the change was growth of 10 bringing 40 to 50.

But you can rewrite the above formula using definition of subtraction of fractions with like denominators.

percent of change = new/old – old/old

You get the same answer. That old/old turns out to equal 1 always. So that could be another way of writing it.

Example: 50/40 – 40/40 = 5/4 – 1 = 1/4; and 1/4 = 25/100 or 25%

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