Step 1: Identify the prices for the base year (2005) and the current year (2010).
Prices in 2005 (P0β):
Commodity A: 12
Commodity B: 16
Commodity C: 10
Prices in 2010 (Pnβ):
Commodity A: 20
Commodity B: 25
Commodity C: 12
Step 2: Calculate the sum of prices for the base year (βP0β).
βP0β=12+16+10=38
Step 3: Calculate the sum of prices for the current year (βPnβ).
βPnβ=20+25+12=57
Step 4: Apply the formula for the Price Index Number using the simple aggregative method.
The formula is:
PriceIndexNumber=βP0ββPnββΓ100
Substitute the calculated sums into the formula:
PriceIndexNumber=3857βΓ100
PriceIndexNumber=1.5Γ100
PriceIndexNumber=150
The Price Index Number using the simple aggregative method is 150β.
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