How To Really Treat Percentages With Negative Numbers

This type of calculation is trickier than you think it is!

Hemanth
Street Science

--

How To Really Treat Percentages With Negative Numbers — A table listing the following information: Product A → Return: 600 ; Product B → Return: 400 ; Product C → Return: -400; Total Return: 600. Below the table the following question is written: “What is A’s contribution to the total return?”
Image created by the author

When do you really need to treat percentages with negative numbers? “Not often. If not, never!” This might be the typical person’s answer. But what if I told you that this “special” requirement comes up far more often than you might imagine. Most of the time, the issue goes under the radar or is hidden in plain sight.

It is often the case that you and I are the end-users of such calculations rather than the ones doing them. Therefore, we are often oblivious to the fact. However, if we are not careful or if we do not understand what it is that we are reading/using, it may lead us to make poor decisions in potentially critical situations.

Before I proceed any further, let me take a moment to explain what exactly is the requirement/issue that I am discussing here.

What are Percentages with Negative Numbers?

Our typical understanding of percentage calculations is reserved for positive numbers only. A percentage is nothing but a way of expressing proportions or fractions.

For example, if 750 out of 1200 seats in a theater have been filled, we say that (750/1200)*100 = 62.5% of the seats have been filled.

--

--