Absolute and Relative Change Explained

Absolute and Relative Change

Percentages describe data changes over time, involving a starting (reference) value and a new value.

  • Reference Value: The earlier value in time.
  • New Value: The later value in time.

Absolute Change

The actual increase or decrease from the original reference value.

Absolute Change=New Value−Reference ValueAbsolute\ Change = New\ Value - Reference\ Value

  • Positive Absolute Change: Indicates an increase (new value > reference value).
  • Negative Absolute Change: Indicates a decrease (new value < reference value).

Relative Change

The size of the absolute change in comparison to the reference value, expressed as a percentage.

Relative Change=(Absolute ChangeReference Value)⋅100Relative\ Change = (\frac{Absolute\ Change}{Reference\ Value}) \cdot 100

  • Also known as percent increase or decrease.
  • Negative Relative Change: Percent decrease.
  • Positive Relative Change: Percent increase.

Example 1: Tennessee Population Change (1990-2020)

  • 1990 Population (Reference Value): 4,900,000
  • 2020 Population (New Value): 6,900,000
Absolute Change:

Absolute Change=6,900,000−4,900,000=2,000,000Absolute\ Change = 6,900,000 - 4,900,000 = 2,000,000

The population increased by approximately 2,000,000 people.

Relative Change:

Relative Change=(2,000,0004,900,000)⋅100≈40.8%Relative\ Change = (\frac{2,000,000}{4,900,000}) \cdot 100 \approx 40.8\%

The population increased by approximately 40.8%.

Example 2: Lawnmower Sale

  • Regular Price (Reference Value): $380
  • Sale Price (New Value): $266
Absolute Change:

Absolute\ Change = $266 - $380 = -$114

The price decreased by $114.

Relative Change:

Relative\ Change = (\frac{-$114}{$380}) \cdot 100 = -30\%

There was a 30% decrease in the price.