How to Calculate Percentage Increase
Learn the formula for percentage increase and work through a simple example.
Key idea
Learn the formula for percentage increase and work through a simple example.
Formula or method
Worked example
Start with the values in your question, substitute them into the formula, and keep the units consistent. For example, if a rate is given as 15%, use 0.15 when a formula requires a decimal.
Common mistakes
- Mixing percentage points with percentage change.
- Using different units for the same calculation.
- Rounding too early when several steps are involved.
Why the result can differ
Real-world calculations can include assumptions, rounding, fees, tax rules, calendar conventions, or other details. Treat simple calculator results as estimates when the underlying situation is more complex.
Choosing the correct starting value
Percentage increase always uses the original value as the reference. If a price moves from 80 to 100, the increase is 20 and the percentage increase is 20 ÷ 80 × 100 = 25%. Using 100 as the denominator would answer a different question.
Percentage points versus percentage increase
For rates, distinguish a change in percentage points from a percentage change. Moving from 10% to 15% is an increase of 5 percentage points, while the relative increase is 50% because 5 is half of the original 10.
Quick check
After calculating, ask whether the denominator represents the original value. That single check catches many percentage-change errors.