Compound & Reverse Percentages

Overview

Year 9 takes percentages to their hardest Lower Secondary level: repeated (compound) percentage change, such as compound interest, and reverse percentages, where you work backwards to find the original amount. Both rely on percentage multipliers, and both are heavily tested at IGCSE in financial and growth problems.

What You Will Learn

• Use a percentage multiplier for a single increase or decrease
• Apply repeated percentage change using powers of the multiplier
• Calculate compound interest over several years
• Use reverse percentages to find an original amount
• Choose between simple and compound methods for a given problem

Key Vocabulary

Common Mistakes to Avoid

• Adding the same interest each year instead of compounding on the new total
• Using the new amount as 100% in a reverse percentage problem
• Forgetting to raise the multiplier to a power for several years
• Mixing up the multiplier for an increase (e.g. 1.05) and a decrease (e.g. 0.95)

Frequently Asked Questions