Index NumbersMCQMTP Apr 21Question 3904 of 197
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The cost of living index numbers in years 2015\displaystyle 2015 and 2021\displaystyle 2021 were 97.5\displaystyle 97.5 and 115\displaystyle 115 respectively. The salary of a worker in 2015\displaystyle 2015 was 19,500\displaystyle 19,500. How much additional salary is required for him in 2021\displaystyle 2021 to maintain living standard of 2015\displaystyle 2015?

Options

A3000\displaystyle 3000
B2800\displaystyle 2800
C3500\displaystyle 3500
D4500\displaystyle 4500
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Correct Answer

Option c3500\displaystyle 3500

All Options:

  • A3000\displaystyle 3000
  • B2800\displaystyle 2800
  • C3500\displaystyle 3500
  • D4500\displaystyle 4500

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Detailed Solution & Explanation

We are given: - Cost of living index (CLI) in base year (2015) = 97.5\displaystyle 97.5 - Cost of living index (CLI) in current year (2018/2021) = 115\displaystyle 115 - Salary in base year (2015) = 19,500 To maintain the same standard of living, the salary in the current year should be adjusted proportionally to the CLI: Required Salary=Base Salary×Current CLIBase CLI=19,500×11597.5=23,000.00\text{Required Salary} = \text{Base Salary} \times \frac{\text{Current CLI}}{\text{Base CLI}} = 19,500 \times \frac{115}{97.5} = 23,000.00 Therefore, the additional salary required is: Additional Salary=Required SalaryBase Salary=23,000.0019,500=3,500.00\text{Additional Salary} = \text{Required Salary} - \text{Base Salary} = 23,000.00 - 19,500 = 3,500.00 This matches 3,500. Hence, **Option C** 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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