Quantitative
Percent versus percentage points
A change in a rate is measured in points; its relative change in percent.
Facts checked against sources onWhat does Percent versus percentage points mean?
When a rate moves, the simple difference is measured in percentage points, and the relative change is measured in percent. If market share goes from 20% to 25%, it rose 5 percentage points, which is a 25% increase (5 divided by 20). Mixing the two is one of the most common exhibit mistakes.
Where does it come up in case interview prep?
- Macro forces that move casesLesson in Markets and economies: the world a case lives in
- Real growth, people and incomeLesson in Markets and economies: the world a case lives in
- India for case solversLesson in Regions for case solvers: the big markets of the world
- China and Japan for case solversLesson in Regions for case solvers: the big markets of the world
- Europe and the UK for case solversLesson in Regions for case solvers: the big markets of the world
- Africa and Latin America for case solversLesson in Regions for case solvers: the big markets of the world
- Chart traps that catch candidatesLesson in Charts and data in depth
- The one-sentence so what, from a numberLesson in Saying so what: synthesis and communication at work
Related terms
- Market shareOur sales as a share of total market sales.
- CAGR (compound annual growth rate)The steady yearly growth rate that links a start value to an end value.
- ExhibitA chart or table the interviewer hands you to reason from.
- Rule of 72Years to double is about 72 divided by the growth rate.
- Weighted averageAn average where each part counts in proportion to its size.
- Lakh and croreIndian number units: 1 lakh = 100,000 and 1 crore = 10 million.
- Run rateCurrent performance scaled up to a full year.
- Market sizingEstimating how big a market or quantity is.
Learn it in context
See Percent versus percentage points at work in a lesson from Markets and economies: the world a case lives in, with checks as you go.
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