Percentage point

Percentage point

Percentage points (pp) are the unit for the arithmetic difference of two percentages.

Consider the following hypothetical example: in 1980, 40 percent of the population smoked, and in 1990 only 30 percent smoked. We can thus say that from 1980 to 1990, the incidence of smoking decreased by 10 "percentage points" even though smoking did not decrease by 10 percent (actually it decreased by "25 percent") — percentages indicate ratios, not differences.

Statements such as "between 1980 and 1990, the smoking rate decreased twice as much as the lung cancer rate" are ambiguous: it is not clear whether percentages or percentage points are being compared.

Percentage points are also used to express the difference of risks or probabilities. Consider for instance a certain drug, which cures a given disease in 60 percent of all cases; without the drug, the disease heals spontaneously in only 40 percent of cases. The drug thus causes an absolute risk reduction of 20 percentage points. Here the reciprocal is especially meaningful and is known as the number needed to treat (NNT): 1/(20%) = 1/0.20 = 5; if you treat 5 patients with the drug, you can expect to heal one more case of the disease than you would have without using the drug.

Related units

* Percentage
* Per mille (‰) 1 part in 1,000
* Basis point (‱) 1 part in 10,000
* Parts per million (ppm)
* Parts per billion (ppb)
* Parts per trillion (ppt)
* Baker percentage


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Look at other dictionaries:

  • percentage point — ➔ point1 * * * percentage point UK US noun [C] ► ECONOMICS, FINANCE a unit of measure equal to one percent, used to refer to changes in interest rates: »Markets showed a slight recovery when the Federal Reserve cut short term interest rates by… …   Financial and business terms

  • percentage point — noun the dot at the left of a decimal fraction • Syn: ↑decimal point, ↑point • Hypernyms: ↑mathematical notation * * * percentage point UK US noun [countable] [ …   Useful english dictionary

  • percentage point — UK / US noun [countable] Word forms percentage point : singular percentage point plural percentage points one per cent Interest rates have been cut by half a percentage point …   English dictionary

  • percentage point — /pəˈsɛntɪdʒ pɔɪnt/ (say puh sentij poynt) noun an amount of one per cent. Usage: The term percentage point is used to avoid confusion with a simple percentage calculation. For example, if an interest rate rises from 10% to 11%, it increases by a… …  

  • percentage point — per centage ,point noun count one percent: Interest rates have been cut by half a percentage point …   Usage of the words and phrases in modern English

  • percentage point — noun Date: 1958 one hundredth of a whole ; percent < interest rates rose one percentage point from 6.5 percent to 7.5 percent > …   New Collegiate Dictionary

  • percentage point — percent, proportion of one hundred (one percentage point = one percent) …   English contemporary dictionary

  • percentage point —    a unit of proportion, equal to 0.01 or 1%. This unit is used commonly to describe changes in rates or other quantities that are stated as percentages.    For example, an interest rate that rises from 8% to 10% is said to rise by two percentage …   Dictionary of units of measurement

  • percentage point — noun one hundredth of a given value See Also: percentage rate …   Wiktionary

  • percent, percentage point —    There is an important distinction between the two terms that is not always observed, even on the financial pages. Consider the following example from the business section of The Times of London. Headline: U.S. tax reform to cut top rate by 25% …   Dictionary of troublesome word

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