What is a basis point in economics?
A unit that is equal to 1/100 of 1%.
What is a basis point?
A basis point equals 1/100 of 1% (0.01%). It is used to describe small changes in interest rates or other percentages.
How do you calculate basis points?
Subtract the original percentage from the new percentage, then multiply by 100. For example:
- An increase from 2.2% to 2.8% is an increase of 60 basis points.
- A decrease from 2.8% to 2.6% is a decrease of 20 basis points.