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Question
Statements related to weighted index number:
- Suitable weights are assigned to various commodities.
- It gives relative importance to the commodity in the group.
- In most cases, quantities are used as weights.
- Laaspeyre’s Price index and Paasche’s Price Index are methods of constructing weighted index number.
Options
a, c, d
a, b, c
b, c, d
a, b, c, d
Solution
a, b, c, d
RELATED QUESTIONS
Laaspeyre's index : _________ :: Paasche's index : Current year quantities
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 |
Solve the following:
Calculate Value Index number from the given data:
| Commodity | Base year | Current year | ||
| Price | Quantity | Price | Quantity | |
| A | 40 | 15 | 70 | 20 |
| B | 10 | 12 | 60 | 22 |
| C | 50 | 10 | 90 | 18 |
| D | 20 | 14 | 100 | 16 |
| E | 30 | 13 | 40 | 15 |
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.
Use 1995 as base year in the following problem.
| Commodity | P | Q | R | S | T |
| Price (in ₹) in 1995 | 15 | 20 | 24 | 23 | 28 |
| Price (in ₹) in 2000 | 27 | 38 | 32 | 40 | 45 |
Find the Price Index Number using Simple Aggregate Method in the following example.
Use 1995 as base year in the following problem.
| Commodity | A | B | C | D | E |
| Price (in ₹) in 1995 | 42 | 30 | 54 | 70 | 120 |
| Price (in ₹) in 2005 | 60 | 55 | 74 | 110 | 140 |
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 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 |
Find the Price Index Number using the Simple Aggregate Method in the following example.
Assume 2000 to be base year in the following problem.
| Fruit | Unit | Price (in ₹) in 2000 |
Price (in ₹) for 2007 |
| Mango | doz | 250 | 300 |
| Banana | doz | 12 | 24 |
| Apple | kg | 80 | 110 |
| Peach | kg | 75 | 90 |
| Orange | doz | 36 | 65 |
| Sweet Lime | doz | 30 | 45 |
Find the Price Index Number using the Simple Aggregate Method in the following example.
Use 2005 as base year in the following problem.
| Vegetable | Unit | Price (in ₹) in 2005 |
Price (in ₹) for 2012 |
| Ladies Finger | kg | 32 | 38 |
| Capsicum | kg | 30 | 36 |
| Brinjal | kg | 40 | 60 |
| Tomato | kg | 40 | 62 |
| Potato | kg | 16 | 28 |
Find the Quantity Index Number using the Simple Aggregate Method in the following example.
| Commodity | I | II | III | IV | V |
| Base Year Quantities | 140 | 120 | 100 | 200 | 225 |
| Current Year Quantities | 100 | 80 | 70 | 150 | 185 |
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 | 30 | 22 | 40 | 18 |
| B | 40 | 16 | 60 | 12 |
| C | 10 | 38 | 15 | 24 |
| D | 50 | 12 | 60 | 16 |
| E | 20 | 28 | 25 | 36 |
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 125.
| Commodity | P | Q | R | S | T |
| Base Year Price (in ₹) | 8 | 12 | 16 | 22 | 18 |
| Current Year Price (in ₹) |
12 | 18 | x | 28 | 22 |
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.
State with reason whether you agree or disagree with the following statement:
Any year can be selected as the base year
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)
Explain the steps in constructing a price index number.
