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Question
Solve the following problem :
Find the Value Index Number using Simple Aggregate Method.
| Commodity | Base Year | Current Year | ||
| Price | Quantity | Price | Quantity | |
| I | 20 | 42 | 22 | 45 |
| II | 35 | 60 | 40 | 58 |
| III | 50 | 22 | 55 | 24 |
| IV | 60 | 56 | 70 | 62 |
| V | 25 | 40 | 30 | 41 |
Solution
| Commodity | Base Year | Current Year | p0q0 | p1q1 | ||
| p0 | q0 | p1 | q1 | |||
| I | 20 | 42 | 22 | 45 | 840 | 990 |
| II | 35 | 60 | 40 | 58 | 2100 | 2320 |
| III | 50 | 22 | 55 | 24 | 1100 | 1320 |
| IV | 60 | 56 | 70 | 62 | 3360 | 4340 |
| V | 25 | 40 | 30 | 41 | 1000 | 1230 |
| Total | – | – | – | – | 8400 | 10200 |
From the table, `sum"p"_1"q"_1 = 8,400, sum"p"_1"q"_1 = 10,200`
Value Index Number (V01) = `(sum"p"_1"q"_1)/(sum"p"_0"q"_0) xx 100`
= `(10200)/(8400) xx 100`
= 121.43
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| Commodity | A | B | C | D |
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Mihir prepared the share price index number.
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State with reasons whether you agree or disagree with the following statement.
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Choose the correct pair:
| Group A | Group B | ||
| 1) | Price Index | a) | `(sum"p"_1"q"_1)/(sum"p"_0"q"_0)xx100` |
| 2) | Value Index | b) | `(sum"q"_1)/(sumq"_0)xx100` |
| 3) | Quantity Index | c) | `(sum"p"_1"q"_1)/(sum"p"_0"q"_1)xx100` |
| 4) | Paasche's Index | d) | `(sum"p"_1)/(sum"p"_0")xx100` |
