How to Calculate Percentage Increase and Decrease

A stock jumps from $50 to $65. A jacket drops from $100 to $75. The raw dollar amounts tell you what happened, but percentage change tells you how big it was — on a standardized 100-point scale that lets you compare a $5 shift and a $500 shift side by side.

In this guide you’ll master the universal percentage-change formula, work through real-world increase and decrease examples, and learn the classic traps that trip up even careful calculators.

What Is Percentage Change?

Percentage change measures the relative difference between a starting quantity (the original value) and the ending quantity (the new value):

  • Percentage increase: the new value is larger — e.g., a stock rising from $50 to $65.
  • Percentage decrease: the new value is smaller — e.g., an item marked down from $100 to $75.

If you’re working on fraction-to-percentage problems first, explore our guide on converting fractions to percentages formula. To see how rate changes connect with coordinate graphing, review our tutorial on slope-intercept form explained. You can also verify your steps quickly with the automated CalcSolver calculation tool.

The Universal Percentage Change Formula

One formula handles both directions:

Percentage Change = (New Value – Original Value)/(Original Value) × 100

A positive result means a percentage increase; a negative result means a percentage decrease (the sign shows the direction).

Method 1: Calculating Percentage Increase

  1. Subtract the original value from the new higher value to find the difference.
  2. Divide that difference by the original starting value.
  3. Multiply by 100 and attach the % symbol.

Example: Subscription price increase

A software subscription rises from $40 to $50 per month.

  1. Numerical change: $50 − $40 = $10
  2. Divide by the original: 10 / 40 = 0.25
  3. Convert to a percentage: 0.25 × 100 = 25%

The subscription increased by 25%.

Method 2: Calculating Percentage Decrease

  1. Find the difference: Original − New.
  2. Divide by the original starting value.
  3. Multiply by 100 to get the reduction rate.

Example: Retail discount

A winter coat drops from $120 to $90 on sale.

  1. Difference: $120 − $90 = $30
  2. Divide by the original: 30 / 120 = 0.25
  3. Convert: 0.25 × 100 = 25%

The coat is discounted by 25%.

Worked Example 3: An Increase Followed by a Decrease

A $80 gadget rises 25% in price, then later drops 25%. What’s the net change?

  • After the increase: $80 × 1.25 = $100
  • After the decrease: $100 × 0.75 = $75
  • Net change: (75 − 80) / 80 × 100 = (−5/80) × 100 = −6.25%

You’re down 6.25% overall — proof that equal-and-opposite percentages never cancel. Which brings us to…

The Reversibility Trap: Why +50% and −50% Don’t Cancel

Start with $100 and add 50%: you land at $150. Now subtract 50% — but 50% of $150 is $75, so you land at $75, not $100.

Why it happens: every percentage is computed from its own baseline. Once the first change moves the baseline, the second percentage is measured against a different number. You can’t add, subtract, or reverse percentages without recalculating from the new base.

3 Critical Mistakes to Avoid

  • Dividing by the new value: the single most common error. The denominator is always the original starting value — keep the baseline fixed.
  • Double-labeling negatives: report “−20%” or “a 20% decrease” — never “a −20% decrease.” That double negative confuses everyone.
  • Adding sequential percentages: two consecutive 10% increases don’t make 20%. The second 10% applies to the inflated amount: $100 → $110 → $121, a total increase of 21%, not 20%.

Change over original, times 100: that one formula — applied carefully — covers price adjustments, investment returns, and statistical shifts with total accuracy.

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