The price of five different commodities for year 2018 and 2019 are as follows:
| Commodities | Price is 2018 (in ₹) | Price is 2019 (in ₹) |
| A | 4 | 8 |
| B | 3 | 9 |
| C | 2 | 6 |
| D | 6 | 9 |
| E | 2 | 4 |
The price index number for the tear 2019 with 2018 as the base year, using sample average of price relatives is :
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → 230
To find the price index,
Price index = $\frac{1}{n}∑\left(\frac{Price\,in\,2019}{Price\,in\,2018}×100\right)$
∴ Price Relative for A = $\frac{8}{4}×100=200$
Price Relative for B = $\frac{9}{3}×100=500$
Price Relative for C = $\frac{6}{2}×100=300$
Price Relative for D = $\frac{9}{6}×100=150$
Price Relative for E = $\frac{4}{2}×100=200$
∴ Sample average = $\frac{1}{5}(200+300+500+150+200)$
$=\frac{1150}{5}=230$