Question

Discuss the “weighted” and “unweighted” Index of Prices.

Solution

“Weighted” Index of Prices : In order to allow adequate importance to different commodities in a composite index, we assign suitable weights to them. The weighted index number is simply the weighted arithmetic mean of price relatives defined as

Where the weights W₁ W₂..... ..... W₁₁ are such that ΣW₁ = 1

Some More Questions From Index Numbers Chapter

The impact of change in the price of a commodity with little weight in the index will be:

A consumer price index measures changes in:

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Index Numbers

Discuss the “weighted” and “unweighted” Index of Prices.

Some More Questions From Index Numbers Chapter

The impact of change in the price of a commodity with little weight in the index will be:

A consumer price index measures changes in:

The item having the highest weight in consumer price index for industrial workers is:

In general, inflation is calculated by using:

The item having the highest weight in consumer’s price index for industrial workers is:

consumer price index measures changes in:

The wholesale price index.

D.A. paid to the workers is based on:

Why do we need an index number?

Why is it essential to have different CPIs for different categories of consumers?

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