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31 Is What Percent of 20

An area of concern for many all over the world is about traffic on city streets. And for the most part, what can be done about it? How many of us actually know the answer to this question?

Percent changes applied sequentially do not add up in the usual way. For example, if the 10% increase in price considered earlier (on the $200 item, raising its price to $220) is followed by a 10% decrease in the price (a decrease of $22), then the final price will be $198—not the original price of $200. The reason for this apparent discrepancy is that the two percent changes (+10% and −10%) are measured relative to different quantities ($200 and $220, respectively), and thus do not "cancel out".

In the case of interest rates, a very common but ambiguous way to say that an interest rate rose from 10% per annum to 15% per annum, for example, is to say that the interest rate increased by 5%, which could theoretically mean that it increased from 10% per annum to 10.05% per annum. It is clearer to say that the interest rate increased by 5 percentage points (pp). The same confusion between the different concepts of percent(age) and percentage points can potentially cause a major misunderstanding when journalists report about election results, for example, expressing both new results and differences with earlier results as percentages. For example, if a party obtains 41% of the vote and this is said to be a 2.5% increase, does that mean the earlier result was 40% (since 41 = 40 × (1 + (Source: en.wikipedia.org)

Now it is time to dive deeper into the utility of the percentage difference as a measurement. It should come as no surprise to you that the utility of percentage difference is at its best when comparing two numbers; but this is not always the case. We should, arguably, refrain from talking about percentage difference when we mean the same value across time. We think this should be the case because in everyday life we tend to think in terms of percentage change, and not percentage difference. "How is this even possible?" Thats a good question. The reason here is that, despite the absolute difference gets bigger between these two numbers, the change in percentage difference decreases dramatically. The two numbers are so far apart that such a large increase is actually quite small in terms of their current difference. Therefore, if we want to compare numbers that are very different from one another, using the percentage difference becomes misleading. If you want to avoid any of these problems, our recommendation to only compare numbers that are different by no more than one order of magnitude (two if you want to push it). If you want to learn more about orders of magnitude and what this term means, we recommend our scientific notation calculator.

In the case of interest rates, a very common but ambiguous way to say that an interest rate rose from 10% per annum to 15% per annum, for example, is to say that the interest rate increased by 5%, which could theoretically mean that it increased from 10% per annum to 10.05% per annum. It is clearer to say that the interest rate increased by 5 percentage points (pp). The same confusion between the different concepts of percent(age) and percentage points can potentially cause a major misunderstanding when journalists report about election results, for example, expressing both new results and differences with earlier results as percentages. For example, if a party obtains 41% of the vote and this is said to be a 2.5% increase, does that mean the earlier result was 40% (since 41 = 40 × (1 +In the case of interest rates, a very common but ambiguous way to say that an interest rate rose from 10% per annum to 15% per annum, for example, is to say that the interest rate increased by 5%, which could theoretically mean that it increased from 10% per annum to 10.05% per annum. It is clearer to say that the interest rate increased by 5 percentage points (pp). The same confusion between the different concepts of percent(age) and percentage points can potentially cause a major misunderstanding when journalists report about election results, for example, expressing both new results and differences with earlier results as percentages. For example, if a party obtains 41% of the vote and this is said to be a 2.5% increase, does that mean the earlier result was 40% (since 41 = 40 × (1 + (Source: en.wikipedia.org)