Calculate index numbers from the following data by simple aggregate method taking prices of 1995 as base period.

120

The correct answer is Option (4) → 120

To calculate the price index number using the simple aggregate method, we use the following formula:

$P_{01}​=\frac{∑P_1}{​∑P_0}​​×100$

Where:

• $∑P_0$​ is the sum of prices in the base year (1995).
• $∑P_1$​ is the sum of prices in the current year (2005).

Calculation of Sums

Calculation of Index Number

Substituting the values into the formula:

$P_{01}​=\frac{250}{300}​×100$

$P_{01}​=1.2×100$

$P_{01}​=120$

The price index number for the year 2005, taking 1995 as the base year, is 120. This indicates a 20% increase in the aggregate price level from 1995 to 2005.