Index NumbersMCQPYQ June 24Question 3818 of 197
All Questions

Which index number formula does not satisfy the time reversal test?

Options

AFisher's ideal index and Laspeyre's index
BLaspeyre's index and Paasche's index
CPaasche's index and Fisher's ideal index
DLaspeyre's index, Fisher's ideal index and Paasche's index
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Correct Answer

Option bLaspeyre's index and Paasche's index

All Options:

  • AFisher's ideal index and Laspeyre's index
  • BLaspeyre's index and Paasche's index
  • CPaasche's index and Fisher's ideal index
  • DLaspeyre's index, Fisher's ideal index and Paasche's index

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Detailed Solution & Explanation

Both **Laspeyres' index** and **Paasche's index** do not satisfy the Time Reversal Test, whereas Fisher's ideal index and Marshall-Edgeworth index do satisfy it. Therefore, the pair of formulas that does not satisfy the Time Reversal Test is Laspeyres' index and Paasche's index. Hence, **Option B** 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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