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How to Calculate a Three Percent Annual Increase

Annual increases can be measured as raw numbers or as percentages of the original amount. Using a percentage to measure the increase helps put the increase in perspective. If you know the percentage increase amount, you can calculate both the amount of the increase and the value after the increase if you know the initial amount. Knowing how to calculate a percentage increase can help you plan ahead, whether it be a pay raise or population increase.

Things You'll Need

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Instructions

    • 1

      Divide 3 percent by 100 to get a rate of increase of 0.03.

    • 2

      Multiply the rate of increase by the original amount to find the amount of the annual increase. For example, if you started with a salary of $48,000, multiply $48,000 by 0.03 to get $1,440. Alternatively, if you wanted to calculate a 3 percent increase in population and you started with 5 million, multiply 5 million by 0.03 to get 150,000.

    • 3

      Add the increase to the original amount to find the new amount. Completing the first example, add $1,440 to $48,000 to find the new salary equals $49,440. Finishing the second example, add 150,000 to 5 million to get 5,150,000 as the new population.

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