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Question
Find the Price Index Number using the Simple Aggregate Method in the following example.
Use 1990 as base year in the following problem.
| Commodity | Unit | Price (in ₹) for year 2000 |
Price (in ₹) for year 2006 |
| Butter | kg | 27 | 33 |
| Cheese | kg | 30 | 36 |
| Milk | litre | 25 | 29 |
| Bread | loaf | 10 | 14 |
| Eggs | doz | 24 | 36 |
| Ghee | tin | 250 | 320 |
Solution
| Commodity | Unit | Price (in ₹) for year 2000 |
Price (in ₹) for year 2006 |
| Butter | kg | 27 | 33 |
| Cheese | kg | 30 | 36 |
| Milk | litre | 25 | 29 |
| Bread | loaf | 10 | 14 |
| Eggs | doz | 24 | 36 |
| Ghee | tin | 250 | 320 |
| Total | 366 | 468 | |
From the table, ∑ p0 = 366, ∑ p1 = 468
Price Index Number (P01) = `(sum "p"_1)/(sum "p"_0) xx 100`
`= 468/366 xx 100`
= 127.87
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RELATED QUESTIONS
Calculate the price index number from the given data:
| Commodity | A | B | C | D |
| Price in 2005 (₹) | 6 | 16 | 24 | 4 |
| Price in 2010 (₹) | 8 | 18 | 28 | 6 |
Solve the following:
Calculate Quantity Index number from the given data:
| Commodity | P | Q | R | S | T |
| Base year quantities | 170 | 150 | 100 | 195 | 205 |
| Current year quantities | 90 | 70 | 75 | 150 | 95 |
Calculate Laaspeyre's index from the given data:
| Commodity | Base year | Current year | ||
| Price | Quantity | Price | Quantity | |
| X | 8 | 30 | 12 | 25 |
| Y | 10 | 42 | 20 | 16 |
Solve the following:
Calculate Paasche's index from the given data:
| Commodity | Base year | current year | ||
| Price | Quantity | Price | Quantity | |
| X | 8 | 30 | 12 | 25 |
| Y | 10 | 42 | 20 | 16 |
Distinguish between Laaspeyre's Index and Paasche's Index.
Explain the steps involved in the construction of index numbers.
Find the Price Index Number using Simple Aggregate Method in the following example.
| Commodity | Unit | Base Year Price (in ₹) | Current Year Price (in ₹) |
| Wheat | kg | 28 | 36 |
| Rice | kg | 40 | 56 |
| Milk | litre | 35 | 45 |
| Clothing | meter | 82 | 104 |
| Fuel | litre | 58 | 72 |
Find the Price Index Number using the Simple Aggregate Method in the following example.
Use 2000 as base year in the following problem.
| Commodity | Price (in ₹) for year 2000 |
Price (in ₹) for year 2006 |
| Watch | 900 | 1475 |
| Shoes | 1760 | 2300 |
| Sunglasses | 600 | 1040 |
| Mobile | 4500 | 8500 |
Find the Quantity Index Number using the Simple Aggregate Method in the following example.
| Commodity | A | B | C | D | E |
| Base Year Quantities | 360 | 280 | 340 | 160 | 260 |
| Current Year Quantities | 440 | 320 | 470 | 210 | 300 |
Find the Value Index Number using Simple Aggregate Method in the following example.
| Commodity | Base Year | Current Year | ||
| Price | Quantity | Price | Quantity | |
| A | 50 | 22 | 70 | 14 |
| B | 70 | 16 | 90 | 22 |
| C | 60 | 18 | 105 | 14 |
| D | 120 | 12 | 140 | 15 |
| E | 100 | 22 | 155 | 28 |
Find x if the Price Index Number by Simple Aggregate Method is 120, taking 1995 as base year.
| Commodity | A | B | C | D |
| Price (in ₹) for 1995 | 95 | y | 80 | 35 |
| Price (in ₹) for 2003 | 116 | 74 | 92 | 42 |
Find the odd word
Steps involved in the construction of index number -
Assertion (A): Generally, arithmetic mean is used in the construction of index numbers.
Reasoning (R): Arithmetic mean is simple to compute compared to other averages.
Study the following table, figure, passage and answer the question given below it.
| Commodities | Price in 2015 in Rs (base year) P0 |
Price in 2019 in Rs. (current year) P1 |
| L | 20 | 30 |
| M | 60 | 80 |
| N | 100 | 130 |
| O | 40 | 60 |
| Total | ∑P0 = ? | ∑P1 = ? |
- Complete the above table (1m)
- Construct Price Index number from the above data (3m)
State with reasons whether you agree or disagree with the following statement:
It is not essential to decide the purpose of an index number while constructing it.
Explain the steps in constructing a price index number.
