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Calculate the unweighted price index for 2020 using 2019 as the base year.
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12 stepsHere are the solutions for questions 23, 24, and 25.
23. Calculate the unweighted price index for 2020 using 2019 as the base year.
State the formula for the unweighted price index.
The unweighted price index is calculated as:
where is the price in the current year (2020) and is the price in the base year (2019).
Sum the prices for the base year (2019).
Sum the prices for the current year (2020).
Substitute the sums into the formula and calculate the index.
The correct option is C.
The unweighted price index for 2020 using 2019 as the base year is .24. For the data in Table 5, calculate the Laspeyres price index for 2021 using 2020 as the base year.
State the formula for the Laspeyres price index.
The Laspeyres price index is calculated as:
where is the price in the current year (2021), is the price in the base year (2020), and is the quantity in the base year (2020).
Calculate for the base year (2020).
- Acid A:
- Acid B:
- Acid C:
- Acid D:
Calculate for the current year (2021) using base year quantities (2020).
- Acid A:
- Acid B:
- Acid C:
- Acid D:
Substitute the sums into the formula and calculate the index.
The correct option is B.
The Laspeyres price index for 2021 using 2020 as the base year is .25. For the data in Table 5, calculate the Paasche Price Index for 2021 using 2019 as the base.
State the formula for the Paasche price index.
The Paasche price index is calculated as:
where is the price in the current year (2021), is the price in the base year (2019), and is the quantity in the current year (2021).
Calculate for the current year (2021).
- Acid A:
- Acid B:
- Acid C:
- Acid D:
Calculate using base year prices (2019) and current year quantities (2021).
- Acid A:
- Acid B:
- Acid C:
- Acid D:
Substitute the sums into the formula and calculate the index.
The correct option is A.
The Paasche Price Index for 2021 using 2019 as the base is .
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