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(sump1q1w)/(sump0q0w)xx100 gives...

`(sump_1q_1w)/(sump_0q_0w)xx100` gives

A

Value Index Number by Simple Aggregate method

B

Value Index Number by Weighted Aggregate method

C

Cost of Living Index Number

D

Laspeyre’s Index Number

Text Solution

AI Generated Solution

The correct Answer is:
To solve the expression \((\text{sump}_1q_1w)/(\text{sump}_0q_0w) \times 100\), we need to understand the components involved in the formula. ### Step-by-Step Solution: 1. **Identify the Components**: - Let \( P_1 \) be the current price of the commodity. - Let \( Q_1 \) be the current quantity of the commodity. - Let \( P_0 \) be the base price of the commodity. - Let \( Q_0 \) be the base quantity of the commodity. - Let \( W \) be the respective weights of the commodities. 2. **Calculate the Current Value**: - The current value can be represented as: \[ \text{sump}_1q_1w = \sum (P_1 \cdot Q_1 \cdot W) \] - This represents the total value of the commodities at current prices and quantities, weighted by their respective weights. 3. **Calculate the Base Value**: - The base value can be represented as: \[ \text{sump}_0q_0w = \sum (P_0 \cdot Q_0 \cdot W) \] - This represents the total value of the commodities at base prices and quantities, also weighted. 4. **Formulate the Index Number**: - The formula for the index number is given by: \[ \text{Index Number} = \left( \frac{\text{sump}_1q_1w}{\text{sump}_0q_0w} \right) \times 100 \] - This formula compares the current weighted value to the base weighted value and expresses it as a percentage. 5. **Interpret the Result**: - The result of this calculation gives us a weighted index number, which indicates how much the value of the commodities has changed from the base period to the current period. ### Final Answer: The expression \((\text{sump}_1q_1w)/(\text{sump}_0q_0w) \times 100\) gives us a weighted index number that reflects the change in value of the commodities from the base period to the current period.
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