Find the new value after a percentage increase, or find the percentage increase between two values.
Percentage increase is a specific type of percentage change — one where the direction is always positive (upward). The formula is identical to percentage change: ((New - Original) / Original) × 100. The only difference is context: percentage increase implies you expect a positive result, while percentage change accommodates both increases and decreases.
Finding the new value after a percentage increase is a different calculation: New = Original × (1 + Percentage/100). This formula is used constantly in finance (applying a return to an investment), retail (marking up a wholesale price), and salary negotiations (calculating a raise).
A common mistake: adding the percentage directly to the number. A 25% increase on 200 is not 200 + 25 = 225. It is 200 × 1.25 = 250. The 25% must be applied as a proportion of the original value, not added as a flat number.
Two successive percentage increases compound rather than add. A 10% increase followed by another 10% increase gives 1.10 × 1.10 = 1.21, or 21% total — not 20%. This is the fundamental principle behind compound growth and compound interest.
Conversely, a 20% increase followed by a 20% decrease does not return to the original. Starting at 100: +20% gives 120, then -20% of 120 gives 96 — 4% below the start. This asymmetry is why investment losses hurt more than equivalent gains help: losing 50% requires a 100% gain just to break even.