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Math Help - Percentage increase / decrease eplanation

  1. #1
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    Percentage increase / decrease eplanation

    Hi

    I am trying to explain how the following works. If a object costs 100 the shop increase it by 5% so it is now 105.
    The shop then reduce it from 105 buy 10% in a sale and now being 94.50.
    Why is this different to the original 100 and the 5% being taken of this which would be 95.
    So basically why is increasing something by 5% then reducing by 10% not the same as reducing the original by 5%

    I can do the math behind these calculations, im just confused how to explain why there is a difference.

    regards
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  2. #2
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    Re: Percentage increase / decrease eplanation

    Consider an easier example.
    Suppose a $100 item is increased by 10% and subsequently reduced by 10%. The resulting price is $99.
    10% of 110 is greater than 10% of 100 so the reduction is greater than the raise.
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  3. #3
    MHF Contributor

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    Re: Percentage increase / decrease eplanation

    The amount of a percent change depends upon the base. 5% of a larger amount will be larger than 5% of a smaller amount. When you added 5% to the orginal price, you increased the base.
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