Index NumbersPYQ Jan 26Question 4297 of 197
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Fisher's Ideal Price Index is defined as the _________ of the Laspeyres' and the Paasche's Index.

Options

AHarmonic Mean
BGeometric Mean
CArithmetic Mean
DSimple Mean
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Correct Answer

Option bGeometric Mean

All Options:

  • AHarmonic Mean
  • BGeometric Mean
  • CArithmetic Mean
  • DSimple Mean

Detailed Solution & Explanation

Fisher's Ideal Price Index (PF\displaystyle P_F) is mathematically defined as the geometric mean of Laspeyres' Price Index (PL\displaystyle P_L) and Paasche's Price Index (PP\displaystyle P_P): PF=PL×PPP_F = \sqrt{P_L \times P_P}
Let us evaluate the options: - **Geometric Mean**: The square root of the product of two quantities, which matches the definition of Fisher's Ideal 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.

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