how to calculate accurate %age increase or decrease

#1

Hi all

It may be sounds foolish but i have a question

100-------------------------120

now 20% increase at year 1 gives 120 ---------100*1.2=120

if we know that year 2 is 120 and there is % age decrease 20% then ------------

20 % decrease means 80% is left so

0.8* 120= 96

or

120/1.2 =100

which one is correct and why

#2

The correct answer is 96

Think of it in these terms 120 is now your base number so 120 = 100% so to get 80% (or to take away 20%) you divide by 100 and multiply by 80

(120 / 100) x 80, or 120 x 0.8

If you were to divide by 1.2 you are starting with 120%, (120 / 120) x 100 which is wrong

to get back from 120 to 100 you have to solve for the following

(a) x 120 = 100

(a) = 100 / 120

(a) = 0.833333333333

So to get back from 120 to 100 you have to take away 16.666666667 %

Hope thats clear

Best,

PC

#3

I solve it exactly the same way as you said in a numeracy reasoning …
The question was that in 10th year the amount is 10,000 which was the increase of 30% of previous year .What is the amount of previous year .

i solved it ----- 10000*0.7=7000 and when i checked it was incorrect i also checked other sites and trying to figure it out …:slight_smile:

#4

OK in the case you mention they are saying that 10,000 is equivilant to 130%

i.e. last years fiqure is 100% + 30 % increase = 10,000 = 130%

You have to get back to 100%, so in this case you have to do the following

(10,000 / 130) x 100 or 10,000 / 1.30 = 7692.31

However, if they said that last years figure was 30% LESS THAN THIS YEARS figure then 10,000 would be 100% and then you would be correct to do 10,000 x 0.70 = 7000

In the question they asked - as 10,000 is equal to last years fiqure plus 30%, last years figure is your base number i.e last years figure is 100%

#5

These type of questions can be tricky esp. under timed conditions

#6

Right

just to update

V2 =final value
V1 = initial value

V2/V1 -1 ===== IF +VE VALUE THEN IT IS % age increase
if -ve it is %age decrease

cheers