What is the average percent change based on the total annual sales for the past five years?

To determine the average percent change based on total annual sales over the past five years, one first calculates the percent change for each individual year compared to the previous year. This is done by taking the difference in sales from one year to the next, dividing that by the sales of the previous year, and then multiplying by 100 to convert it into a percentage.

Once the percent changes for each year are calculated, the average percent change is found by adding together all the individual percent changes and then dividing that total by the number of years for which data is available (in this case, five). The resulting figure gives a comprehensive average that reflects overall performance over the period.

The choice of 6.5% implies that across the five years, on average, sales have grown by this percentage amount annually, indicating steady growth while also reflecting any variations in sales growth that might have occurred from year to year. This percentage serves as a useful metric for assessing overall business performance and helps in making strategic decisions for future operations.

In contrast, other percentages like 5%, 7%, or 10% would suggest different average growth rates, which may not accurately represent the data if the calculated average is indeed 6.5%. Each of those figures would imply a