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State true or False: sum(p1q1)/(p0q1)xx1...

State true or False: `sum(p_1q_1)/(p_0q_1)xx100` is Paasche’s Price Index Number.

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To determine whether the statement "sum(p_1q_1)/(p_0q_1)xx100 is Paasche’s Price Index Number" is true or false, we can analyze the formula and compare it with the correct definition of Paasche's Price Index Number. ### Step-by-Step Solution: 1. **Understand the Components**: - Let \( P_0 \) be the price in the base year. - Let \( P_1 \) be the price in the current year. - Let \( Q_1 \) be the quantity in the current year. 2. **Define Paasche’s Price Index**: - Paasche’s Price Index is defined as: \[ P = \frac{\sum (P_1 Q_1)}{\sum (P_0 Q_1)} \times 100 \] - Here, the numerator is the total value of current year prices multiplied by current year quantities, and the denominator is the total value of base year prices multiplied by current year quantities. 3. **Analyze the Given Expression**: - The expression given in the question is: \[ \frac{\text{sum}(p_1 q_1)}{(p_0 q_1)} \times 100 \] - In this expression, the denominator is not summing over the quantities, which is a crucial part of the Paasche's Price Index formula. 4. **Conclusion**: - Since the expression does not match the definition of Paasche’s Price Index (specifically, it lacks the summation in the denominator), we can conclude that the statement is **False**. ### Final Answer: **False**: The expression given is not Paasche’s Price Index Number.
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Knowledge Check

  • (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
  • The formula p_(01)=(sump_1q_0)/(sump_0q_0)xx100 is for

    A
    Laspeyre’s Price Index Number
    B
    Paasche’s Price Index Number
    C
    Fisher’s Price Index Number
    D
    Walsh’s Price Index Number
  • P_(01)=(sump_(1)q_(0))/(sump_(0)q_(0))xx100 is the formula of:

    A
    Laspeyre's Method
    B
    Paasche's Method
    C
    Fisher's Method
    D
    none of these
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