If the price index is 132, it means that price has increased by ……….. Compared to base period.

Answer

To solve the problem, we need to determine the percentage increase in price given a price index of 132. Here’s a step-by-step solution:

### Step 1: Understand the Price Index Formula
The price index (P01) is calculated using the formula:
\[ P01 = \frac{P1}{P0} \times 100 \]
where:
- \( P01 \) is the price index,
- \( P1 \) is the price in the current year,
- \( P0 \) is the price in the base year.

### Step 2: Substitute the Given Price Index
We know that the price index is 132. Therefore, we can set up the equation:
\[ 132 = \frac{P1}{P0} \times 100 \]

### Step 3: Rearrange the Equation to Find the Ratio of Current Price to Base Price
To isolate \( \frac{P1}{P0} \), we divide both sides by 100:
\[ \frac{P1}{P0} = \frac{132}{100} \]
This simplifies to:
\[ \frac{P1}{P0} = 1.32 \]

### Step 4: Express \( P1 \) in Terms of \( P0 \)
From the ratio, we can express \( P1 \) as:
\[ P1 = 1.32 \times P0 \]

### Step 5: Calculate the Increase in Price
The increase in price can be calculated as:
\[ \text{Increase} = P1 - P0 = 1.32P0 - P0 = (1.32 - 1)P0 = 0.32P0 \]

### Step 6: Calculate the Percentage Increase
To find the percentage increase, we use the formula:
\[ \text{Percentage Increase} = \frac{\text{Increase}}{P0} \times 100 \]
Substituting the increase we found:
\[ \text{Percentage Increase} = \frac{0.32P0}{P0} \times 100 = 0.32 \times 100 = 32\% \]

### Final Answer
Thus, if the price index is 132, it means that the price has increased by **32%** compared to the base period.

---