Determining the relative change between two numerical values is achieved by dividing the absolute difference between them by the initial value, and then multiplying the result by 100 to express it as a percentage. For instance, if an initial investment of $100 grows to $120, the difference is $20. Dividing this difference by the initial investment ($100) and multiplying by 100 yields a 20% increase.
This calculation provides crucial context for interpreting changes in data across various fields. From evaluating investment returns and assessing sales growth to tracking project progress and analyzing scientific experiments, understanding proportional change rather than just absolute difference is essential for informed decision-making. Historically, this method has been fundamental to financial analysis, scientific progress, and numerous other disciplines requiring quantitative comparisons. Its consistent application ensures a standardized approach to evaluating change, facilitating clear communication and understanding.
