Compute Marshall Edgeworth Ideal Index No.
|
Commodities |
Price (₹) |
Value |
Price (₹) |
Value |
|
|
2008 |
2010 |
||
|
A |
5 |
40 |
8 |
40 |
|
B |
8 |
64 |
12 |
168 |
|
C |
10 |
120 |
22 |
132 |
|
D |
12 |
144 |
26 |
208 |
|
E |
16 |
288 |
20 |
300 |
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → 191.52
For calculating base period and current period quantity we divide value by price.
| Commodity |
$p_0$ |
$q_0$ |
$p_1$ |
$q_1$ |
$p_1q_0$ |
$p_0q_0$ |
$p_1q_1$ |
$p_0q_1$ |
|
A |
5 |
8 |
8 |
5 |
64 |
40 |
40 |
25 |
|
B |
8 |
8 |
12 |
14 |
96 |
64 |
168 |
112 |
|
C |
10 |
12 |
22 |
6 |
264 |
120 |
132 |
60 |
|
D |
12 |
12 |
26 |
8 |
312 |
144 |
208 |
96 |
|
E |
16 |
18 |
30 |
10 |
540 |
288 |
300 |
160 |
|
|
|
|
|
|
$\sum p_1q_0= 1276$ |
$\sum p_0q_0= 656$ |
$\sum p_1q_1= 848$ |
$\sum p_0q_1= 453$ |
Marshall-Edgeworth Method:
$P_{01} = \frac{\sum p_1(q_0 + q_1)}{\sum p_0(q_0 + q_1)} \times 100 = \frac{\sum p_1q_0 + \sum p_1q_1}{\sum p_0q_0 + \sum p_0q_1} \times 100$
$= \frac{1276 + 848}{656 + 453} \times 100 = \frac{2124}{1109} \times 100 = 191.52$