Question

Q 10.13: If Year 1 equals $1,000, Year 2 equals $1,920, and Year 3 equals $1,893, the percentage to be assigned for Year 2 in a trend analysis, assuming that Year 1 is the base year, is ________ percent.

Answer 1

192

Step-by-step explanation:

In trend analysis using a base year, the base year percentage is always taken as 100% and the following years will have values below or above 100%.

If there are values above 100% for example 120%, it means there was an increase of 20% on the base year.

If there is a a decrease below 100% it means there was a fall below the base year figure for example 80% is 20% less than the base year.

In the given scenario if we calculate increase in year 2

Percentage increase in year 2 = {(1920 - 1000)/1000} * 100

Percentage increase in year 2 = 92% increase

So the value of the second year will be the increase plus 100%

That is 192