We are surrounded by numbers and our everyday life greatly depends on them. Working with numbers has its own rules and you have to know them in order not to make mistakes which may cost you money. One of the major “numbers” things you should know is how to work out percentages.

Surely, you can live your life without knowing how to that, but if you do not want to look stupid when somebody tells you about 15% or whatever of something, you’d better read this article.

Now let’s start our journey to the world of percentages.

What the word “percentage” means and what it is used for

Generally, a percentage means a part of something. It’s measured in fractions of 100 (per cent means per hundred) and is displayed as %. That is 14% is 14 parts of 100, and 34.7% means 34.7 part of 100. 100% means everything.

Percentage is used for comparing things and numbers with each other. Imagine that last month you paid $20 out of the $50 bill for Internet and now you are asked to pay $30 out of the $80 bill. Are you paying more or less this month? You can answer only if you know how to work out percentages.

The rule for working out a percentage is the following: if you have two numbers, divide the smaller number by the bigger one and multiply the result by 100.

In the example above you paid $20 out of the $50 bill. Now we divide 20 (the smaller number) by 50 (the bigger number) and get 0.4. Multiply 0.4 by 100, and we get 40%. For this month bill we divide 30 by 80, and after multiplying the result we get 37.5%, that is your part of the bill decreased, and you know that.

If you have a number and you are said to calculate a given percentage out of it, simply divide the number by 100 and then multiply the result by the given percentage. Example: you have to say how much is 20 per cent of 250. First, you divide 250 by 100 and get 2.5, and, second, you multiply 2.5 by 20. In the end you get 50.

Let’s consider such a common situation like leaving a tip at a restaurant. The final bill is $75 and you want to give a 10% tip. So, how much should you give to a waiter?

You can calculate the amount of the tip using the method I told you above, but for such simple percentages as 10%, 20$, 25%, and 50% there is a much easier way.

You just divide your $75 by 10 and get the number that you want to know -- $7.5 (10% out of $75).

For 20% you should divide by 5. For 25% divide by 4. And for 50% divide by 2.

If you clearly understand the main rule of percentages and had no problems with the examples above, you should be able to work with increasing or decreasing percentages.

If you’re told that your salary is increased by 5%, you just have to calculate how much is those 5% in money and add the result to your current salary. If you’re told that population of an African country decreased by 2% during the last year, you should calculate how much is those 2% in numbers and minus the result from the basic number. That simple.