Calculate price index number for 1990 taking 2010 as the base year from the following data by simple aggregative method:
|
Item |
Rice |
Wheat |
Pulses |
Millets |
Oil |
|
Price in year 1990 (in ₹) |
60 |
40 |
100 |
60 |
90 |
|
Price in year 2010 (in ₹) |
140 |
60 |
205 |
70 |
100 |
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → 164.29
The Simple Aggregative Price Index ($P_{01}$) is given by:
$P_{01} = \frac{\sum p_1}{\sum p_0} \times 100$
Where:
- $\sum p_0$ = Total price of all items in the base year (1990)
- $\sum p_1$ = Total price of all items in the current year (2010)
Calculation Table
|
Item |
Price in 1990 ($p_0$) |
Price in 2010 ($p_1$) |
|
Rice |
60 |
140 |
|
Wheat |
40 |
60 |
|
Pulses |
100 |
205 |
|
Millets |
60 |
70 |
|
Oil |
90 |
100 |
|
Total |
$\sum p_0 = 350$ |
$\sum p_1 = 575$ |
Apply the formula:
$P_{01} = \frac{575}{350} \times 100$
$P_{01} \approx 1.64285 \times 100$
$P_{01} = 164.29$