MCQ Questions for Class 11 Commerce Economics Index Numbers Quiz 4

HDI was devised by the United Nations Development Programme (UNDP) in 1990 in their first ____________.

0%
HDI Ranking Report
0%
Human Development Report
0%
UNDP Agreement
0%
none of the above

Human development covers which of the following aspects?

0%
Economic aspects
0%
Social aspects
0%
Cultural aspects
0%
All of the above

Human development is the end of all activities, while ____________ is only a means to this end.

0%
economic growth
0%
profit
0%
supply of output
0%
all of the above

Calculate Laspyre's index from the following data-

Commodity	Quantity	Price	Price
		1996	1997
A	25	3	38
B	9	5	12
C	12	2	15

0%
168.65
0%
143.67
0%
141.57
0%
141.67
0%
None of these

P0 indicates:

0%
Price of the base year
0%
Price of the current year
0%
Average price
0%
None of these

The quotations for four different commodities for the years 2000 and 2005 are given below. Calculate the index number for 2005 , with 2000 as base year by using weighted average of price relatives method.

0%
$164.05$
0%
$161.05$
0%
$154.05$
0%
$151.05$

Taking 1975 as the year with and index number 100, calculate an index number for 1979 , based on weighted average of price relatives.

Commodity	A	B	C	D
Weight	30	15	25	30
Price per unit in 1975	20	10	5	40
Price per unit in 1979	24	20	30	40

0%
$245$
0%
$246$
0%
$235$
0%
$275$

Explanation

$Commmodity$	$Weight$ $w$	$Price\,per\,unit\,in\,1975$ $P_0$	$Price\,per\,unit\,in\,1979$	$Price\,relative$ $I=\dfrac{P_1}{P_0}\times 100$	$I.w$
$A$	$30$	$20$	$24$	$120$	$3600$
$B$	$15$	$10$	$20$	$200$	$3000$
$C$	$25$	$5$	$30$	$600$	$15000$
$D$	$3 0$	$40$	$40$	$100$	$3000$
$Total$	$\sum w=100$				$\sum I.w=24600$

$\Rightarrow$

$P_{01}=\dfrac{\sum .Iw}{\sum w}=\dfrac{24600}{100}=246$

Find the consumer price index number for 1991 on the base of 1990 from the following data using the method of weighted relatives.

Item	Quantity(units)	Price in 1990	Price in 1991
A	20	200	320
B	14	400	420
C	15	100	120
D	18	40	60
E	10	20	28

0%
123.45
0%
113.47
0%
198.26
0%
137.27

Explanation

$Item$	$Quantity$ $(Units)$ $w$	$Price\,in\,1990$ $P_0$	$Price\,in\,1991$ $P_1$	$Price\,relative$ $I=\dfrac{P_1}{P_0}\times 100$	$Iw$
$A$	$20$	$200$	$320$	$160$	$3200$
$B$	$14$	$400$	$420$	$105$	$1470$
$C$	$15$	$100$	$120$	$120$	$1800$
$D$	$18$	$40$	$60$	$150$	$2700$
$E$	$10$	$20$	$28$	$140$	$1400$
$Total$ $(\sum)$	$77$				$10570$

$\Rightarrow$

$P_{01}=\dfrac{\sum Iw}{\sum w}=\dfrac{10570}{77}=137.27$

Calculate weighted index number for 2001 from the following data:

Item	A	B	C
Quantity	20	15	10
Price in 2000	200	100	20
Price in 2001	320	120	28

0%
134.56
0%
142.22
0%
148.77
0%
150.78

Explanation

$Item$	$Quantity$ $w$	$Price\,in\,2000$ $P_0$	$Price\,in\,2001$ $P_1$	$I=\dfrac{P_1}{P_0}\times100$	$Iw$
$A$	$20$	$200$	$320$	$160$	$3200$
$B$	$15$	$100$	$120$	$120$	$1800$
$C$	$10$	$20$	$28$	$140$	$1400$
$Total$	$\sum w=45$				$\sum Iw=6400$

$\therefore$ By using weighted average price relative method.

$\Rightarrow$

$P_{01}=\dfrac{\sum Iw}{\sum w}=\dfrac{6400}{45}=142.22$

Using

$2005$ as base year , the price of a commodity in

$2007$ isCalculate the index number for 2007 if 2006 is taken as the base year.

0%
105.93
0%
104.23
0%
103.93
0%
112.3

Using

$2005$ as base year , the price of a commodity in

$2006$ areCalculate the index number for 2005 if 2006 is taken as the base year.

0%
84.75
0%
82.18
0%
81.18
0%
78.07

Explanation

$N=1$ (Since only one commodity)

Take price

$=Rs.100$ as base price for

$2005$

$\implies p_1=100$

$p_0=118$ (given)

$\implies$ index no.

$=\cfrac{1}{N}(\sum\cfrac{p_1}{p_0}\times 100)$

$\implies\cfrac{1}{1}(\sum\cfrac{100}{118}\times 100)=84.775\approx 84.75$

Calculate price index for the following data by applying weighted average of price relative method.

Item	Price in 1991 (Rs)	Price in 1992 (Rs)	Quantity in 1991
wheat	2.00	2.50	40 kg
sugar	3.00	3.25	20 kg
Milk	1.50	1.75	10 litre

0%
116.64
0%
117.74
0%
165.43
0%
113.34

Explanation

$Item$	$Price\,in\,1991 (Rs)$ $P_0$	$Price\,in\,1992\,(Rs)$ $P_1$	$weight$	$P_0w$	$P_1w$
$Wheat$	$2.00$	$2.50$	$40\,Kg$	$80$	$100$
$Sugar$	$3.00$	$3.25$	$20\,Kg$	$60$	$65$
$4Milk$ $	$1.50$	$1.75$	$10\,liter$	$15$	$17.5$
$Total$				$\sum P_0w=155$	$\sum P_1w=182.5$

$\Rightarrow$

$P_{01}=\dfrac{\sum P_1 w}{\sum P_0 w}\times 100=\dfrac{182.5}{155}\times 100=117.74$

The formula for a simple aggregative price index is:

0%
$P_{01} = \dfrac{\Sigma p_1}{\Sigma p_0} \times 100$
0%
$P_{01} = \dfrac{1}{N} { \sum ( \dfrac{p_{1}}{p_{0}}} \times 100)$
0%
Either A or B
0%
None of the above

Explanation

The formula for Simple Aggregative Price Index is given by:

$P_{01} = \dfrac{\Sigma p_1}{\Sigma p_0} \times 100$

Where:

$\Sigma{p_0}$ = sum of total prices in base year.

$\sum{p_1}$ = sum of total prices in current year.

$P_{01}$ = index number of the current year

Calculate Fisher Price Index Number.

0%
$220.00$
0%
$216.30$
0%
$219.12$
0%
$221.98$

Explanation

ITEM	Base Year $P_0$	Base Year $Q_0$	Current Year $P_1$	Current Year $Q_1$	$P_0Q_0$	$P_1Q_0$	$P_0Q_1$	$P_1Q_1$
$A$	$4$	$20$	$10$	$15$	$80$	$200$	$60$	$150$
$B$	$8$	$4$	$16$	$5$	$32$	$64$	$40$	$80$
$C$	$2$	$10$	$4$	$12$	$20$	$40$	$24$	$48$
$D$	$10$	$5$	$20$	$6$	$50$	$100$	$60$	$120$
					$182$	$404$	$184$	$398$

Laspeyres Price Index Number

$P^{L}_{01} = \dfrac {\sum P_{1}Q_{0}}{\sum P_{0}Q_{0}}\times 100 = \dfrac {404}{182}\times 100 = 221.98$
Paasche Price Index Number

$P^{P}_{01} = \dfrac {\sum P_{1}Q_{1}}{\sum P_{0}Q_{1}}\times 100 = \dfrac {398}{184}\times 100 = 216.30$
Fisher Price Index Number

$P^{F}_{01} = \sqrt {\sum P^{L}_{01}\times P^{P}_{01}} = \sqrt {(221.98 \times 216.3)} = 219.12$ .

_______ is used in calculating the purchasing power of money and real wage.

0%
CPI
0%
WPI
0%
IIP
0%
None

Index nos. show _______ changes rather than absolute amounts of change.

0%
Relative
0%
Percentage
0%
Both (a) and (b)
0%
None of above

Laspeyre's index and Dorbish/Bowley index of a city for the year 2008 are

$104.8$ and

$111.9$ , find the index number under Paache's method___.

0%
$116.60$
0%
$114.35$
0%
$119$
0%
$117.90$

An index number of 250 indicates that __________.

0%
the value is two hundred fifty times that of the base period
0%
the value is two hundred fifty more than that of the base period
0%
the value is two and half times that of the base period
0%
none of the above

Calculate Laspeyres Price Index Number.

0%
$220.00$
0%
$216.30$
0%
$219.12$
0%
$221.98$

Explanation

Item	Base Year $P_0$	Base Year $Q_0$	Current Year $P_1$	Current Year $Q_1$	$P_0Q_0$	$P_1Q_0$
$A$	$4$	$20$	$10$	$15$	$80$	$200$
$B$	$8$	$4$	$16$	$5$	$32$	$64$
$C$	$2$	$10$	$4$	$12$	$20$	$40$
$D$	$10$	$5$	$20$	$6$	$50$	$100$
					$182$	$404$

Laspeyres Price Index Number

$P^{L}_{01} = \dfrac {\sum P_{1}Q_{0}}{\sum P_{0}Q_{0}}\times 100 = \dfrac {404}{182}\times 100 = 221.98$

_______ index numbers measure and permit comparison of the prices of certain goods.

0%
Quantity
0%
Quality
0%
Price
0%
Product

Find the remainder when

$6^461$ is divided by 7___.

0%
1
0%
5
0%
6
0%
4

_________ measure the changes in the physical volume of production, construction or employment.

0%
Price index numbers
0%
Quantity index numbers
0%
Production index
0%
None of the above

Base period for an index number should be ________.

0%
a year only
0%
a normal period
0%
a period at distance past
0%
none of the above

Index numbers reveal the state of _________.

0%
inflation
0%
deflation
0%
both (a) and (b)
0%
neither (a) nor (b)

Index number is a __________.

0%
measure of relative change
0%
a special type of an average
0%
a percentage relative
0%
all the above

Index numbers are expressed _________.

0%
in framing of economic policies
0%
in assessing the purchasing power of money.
0%
for adjusting national income
0%
all the above

Laspeyre's index number is also known as ______.

0%
fixed base index
0%
given year method index
0%
base year method index
0%
none of the above

From the following data compute Fisher's ideal quantity index.

Items	$2009$	$2009$	$2010$	$2010$
	Price (Rs.) $(p_0)$	Quantity $(q_0)$	Price (Rs.) $(p_1)$	Quantity $(q_1)$
$A$	$4$	$3$	$6$	$2$
$B$	$5$	$4$	$0$	$4$
$C$	$7$	$2$	$9$	$2$
$D$	$2$	$3$	$1$	$5$

0%
$71.05$
0%
$115.43$
0%
$118.35$
0%
$116.48$

Explanation

	${ p_0 q_0}$	${ p_0 q_1}$	${ p_1 q_0}$	${ p_1 q_1}$
A	12	8	18	12
B	20	20	0	0
C	14	14	18	18
D	6	10	3	5
Sum	52	52	39	35

Fisher's index is given by:

$P_{01}= \sqrt {\dfrac{\Sigma p_1q_0}{\Sigma p_0q_0}\times \dfrac{\Sigma p_1q_1}{\Sigma p_0q_1}}\times100$

$P_{01}= \sqrt {\dfrac{39}{52}\times \dfrac{35}{52}}\times100$

$P_{01}= \sqrt {\dfrac{1365}{2704}}\times100$

$P_{01}= \sqrt {0.50481}\times100$

$P_{01}= 0.710498\times100$

$P_{01}= 71.05$

The prices of a commodity in the year

$1975$ and

$1980$ were

$25$ and

$30$ respectively taking

$1980$ as base year the price relative is :

0%
$109.78$
0%
$110.25$
0%
$113.25$
0%
None of above

If the prices of all commodities in a place have decreased

$35$ % over the base period prices, then the index number of prices of that place is now :

0%
$35$
0%
$135$
0%
$65$
0%
None of above

CBSE Questions for Class 11 Commerce Economics Index Numbers Quiz 4 - MCQExams.com

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Practice Class 11 Commerce Economics Quiz Questions and Answers

CBSE Questions for Class 11 Commerce Economics Index Numbers Quiz 4 - MCQExams.com

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Practice Class 11 Commerce Economics Quiz Questions and Answers

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