Index NumbersMCQPYQ June 24Question 3815 of 197
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The average of base year and current years is used in ____ index number

Options

ALaspeyre's
BPaasche's
CFisher's ideal
DMarshall-Edgeworth
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Correct Answer

Option dMarshall-Edgeworth

All Options:

  • ALaspeyre's
  • BPaasche's
  • CFisher's ideal
  • DMarshall-Edgeworth

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Detailed Solution & Explanation

The **Marshall-Edgeworth Index Number** is computed by taking the average of the base year and current year quantities as weights: w=q0+q12w = \frac{q_0 + q_1}{2} Substituting this weight into the aggregative index formula: P01ME=p1(q0+q12)p0(q0+q12)=p1q0+p1q1p0q0+p0q1×100P_{01}^{ME} = \frac{\sum p_1 \left(\frac{q_0+q_1}{2}\right)}{\sum p_0 \left(\frac{q_0+q_1}{2}\right)} = \frac{\sum p_1 q_0 + \sum p_1 q_1}{\sum p_0 q_0 + \sum p_0 q_1} \times 100 Thus, the average of base year and current year quantities is used. Hence, **Option D** is the correct answer.

About This Chapter: Index Numbers

Paper

Paper 3: Quantitative Aptitude

Weightage

4-6 Marks

Key Topics

Construction of Index Numbers, Time Series

This chapter covers Construction of Index Numbers, Time Series and is part of Paper 3: Quantitative Aptitude in the CA Foundation exam.

View Official ICAI Syllabus

Exam Strategy Tip

This topic carries 4-6 Marks weightage. Focus on understanding core concepts rather than memorizing.

Key Concepts to Understand

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