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How is Impermanent Loss Calculated?

I have always struggled to understand the calculation of impermanent loss. Can someone explain it?

For example, if I invest 1 ETH and 2000 USDC as a liquidity provider when ETH is at $2000.

If ETH rises to $3000, what would my impermanent loss be?
If ETH drops to $1000, what would the impermanent loss be then?

Additionally, under what circumstances does impermanent loss turn into a "permanent loss"?

I’m looking for some education on this!

Circle Owner Admin

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