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2. 8. Title Objectives Introduction Part 1 Part 2 Part 3 Part 4 Further Explorations Reflection Conclusion JOKES ! Page OBJECTIVES We are students from Sekolah Menengah Kebangsaan Section 19 taking Additional Mathematics that are required for us to carry out a . 4. 9. 6. 7. 3. 1. 5.Num.

INTRODUCTION Assalamualaikum and hello .project work while we are in Form 5. To provide learning environment that stimulates and enhances effective learning. iv. To improve thinking skills. To apply and adapt a variety of problem-solving strategies to solve problems. ii. This project can be done in groups or individually. This year the Curriculum Development Division. but each of us are expected to submit by individually a written report. we can gain valuable experiences and enable us: i. vi. iii. Ministry of Education has prepared four tasks for us but we are assigned to choose and complete only one task based on our area of interest. To use the language of mathematics to express mathematical ideas precisely. Upon completion of the Additional Mathematics Project Work. v. . To promote effective mathematical communication To develop mathematical knowledge through problem solving in a way that increases students interest and confidence. vii. To develop positive attitude towards mathematics.

my friends who always supporting me. He tried his best to teach me until I understand what I am supposed to do with the project work. Next. Thanks for giving me a chance to complete my Additional Mathematics project work and as a representative for my school . such as money. any party which involved either directly or indirect in completing this project work. SMK SECTION 19. They also supported me and encouraged me to complete this task so that I will not procrastinate in doing it. I am 17 years old and from 5 Putra . their advise. for giving me the strength and health to do this project work and finish it on time. but he taught me patiently until I knew how to managed the problem well. to buy anything that are related to this project work. HISTORY OF INDEX NUMBER . Sir Somu for guiding me throughout this project. I would like to thank to my teacher. First of all. I am honour to execute my responsibility in order to conduct this project work. computers and others. Even I had some difficulties in doing this task. which is the most needed for this project and facilities such as internet. Thank you everyone. eventhough this project is assign individually but we are cooperate with each other for this project especially in discussion and sharing ideas to ensure our task will finish successfully. books. not forgotten to my parents and family for providing everything. Last but not least.My name is Najaa Syairah . I would like to say Alhamdulillah. Besides. Furthermore.

How do we obtain a composite measure? Basically. index numbers are used to measure the changes in some quantity which we cannot observe directly‟.Index numbers are meant to study the change in the effects of such factors which cannot be measured directly. we are not interested in comparing the prices of only one item. Index numbers are commonly used statistical device for measuring the combined fluctuations in a group related variables. this composite measure is provided by index numbers which may be defined as a device for combining the variations that have come in group of related variables over a period of time. Thus. changes in business activity in a country are not capable of direct measurement but it is possible to study relative changes in business activity by studying the variations in the values of some such factors which affect business activity. and which are capable of direct measurement. We may wish to compare the present agricultural production or industrial production with that at the time of independence. with a view to obtain a figure that represents the „net‟ result of the change in the constitute variables. Here again. . we have to consider all items of production and each item may have undergone a different fractional increase (or even a decrease). For example. but in comparing some sort of average price levels. If we wish to compare the price level of consumer items today with that prevalent ten years ago.

ii. Thus. public health concerns (epidemiology. In general. index of industrial output. although methods described can be applied to other cases. we have index of wholesale prices. In business. Statistics Today During the 20th century. . price quantity value business activity. iv. the creation of precise instruments for agricultural research. iii. The present period is called the current period and some period in the past is called the base period. index of value of exports and index of business activity.In addition. Here we shall be mainly interested in index numbers of prices showing changes with respect to time. index of consumer prices. Index numbers may be classified in terms of the variables that they are intended to measure. the present level of prices is compared with the level of prices in the past. etc. different groups of variables in the measurement of which index number techniques are commonly used are : i.

). sales or changes exports or imports over a certain period of time. etc. Individuals and organizations use statistics to understand data and make informed decisions throughout the natural and social sciences.) necessitated substantial advances in statistical practices. and other areas. education.biostatistics. an index number is a statistical measure designed to show changes in a variable or a group or related variables with respect to . index numbers are aptly called “barometers of economic activity ”. industrial quality control. Today the use of statistics has broadened far beyond its origins. albeit allied. Generally used to indicate the state of the economy. medicine. By definition. The roleplayed by index numbers in Indian trade and industry is impossible to ignore. Statistics is generally regarded not as a subfield of mathematics but rather as a distinct. Many universities maintain separate mathematics and statistics departments. and public health. Index Number Index numbers are today one of the most widely used statistical indicators. business. Index numbers are used in comparing production. etc. It is a very well known fact that the wage contracts of workers in our country are tied to the cost of living index numbers. Statistics is also taught in departments as diverse as psychology. field. econometry. and economic and social purposes (unemploymentrate.

which are expressed in different units. Tea and Coffee. The index number is obtained as a result of an average of all these items. These items naturally are expressed in different units like sugar in Kgs. An index number is commonly referred to as an index.time. Edible Oils. a manufactured products index (a part of the whole sale price index) is constructed using items like Dairy Products. Characteristics of an Index Numbers These are expressed as a percentage: Index number is calculated as a ratio of the current value to a base value and expressed as a percentage. An index number is used for purposes of comparison in cases where the series being compared could be expressed in different units i.e. Index numbers measures changes that are not directly measurable: . geographic location or other characteristics such as profession. etc. Index numbers are specialized averages: Index number is an average with a difference. etc. income. milk in liters. It must be clearly understood that the index number for the base year is always 100. average is a single figure representing a group expressed in the same units. Sugar. On the other hand. etc.

15 times compared to 1980-81. if the index of industrial production is 215. For example.1 in 1992-93 (baseyear 1980-81) it means that the industrial production in that year was up by 2. mean that the net increase in the index reflects an equivalent increase in industrial production in all sectors of the industry. But it does not. Some sectors might have production more than increased their 2. Uses of index numbers Establishes trends . Index numbers essentially capture the changes in the group of related variables over a period of time.An index number is used for measuring the magnitude of changes in such phenomenon. however. which are not capable of direct measurement.15 times while other sectors may have increased their production only marginally.

Determines purchasing power of the rupee Usually index numbers are used to determine the purchasing power of the rupee. the real purchasing power of the rupee can be found out as follows: 100/202=0. Suppose the consumers price index for urban nonmanual employees increased from 100 in 1984 to 202 in 1992. Helps in policy making It is widely known that the dearness allowances paid to the employees is linked to the cost of living index.Index numbers when analyzed reveal a general trend of the phenomenon under study.495 It indicates that if rupee was worth 100 paise in 1984 its purchasing power is 49. Deflates time series data .5 paise in 1992. For instance. From time to time it is the cost of living index. Thus index numbers guide policy making. which forms the basis of many a wages agreement between the employees union and the employer. Index numbers of unemployment of the country not only reflects the trends in the phenomenon but are useful in determining factors leading to unemployment. generally the consumer price index.

Part 1 . nominal income (income at current prices) can be transformed into real income (reflecting the actual purchasing power) by using income deflators. The inflation which has caused the increase in the series can be eliminated by the usage of an appropriate price index and thus making the series real. the increase may not be as a result of increase in the volume of production as one would have it but because of increase in the price. For example. Similarly. assume that industrial production is represented in value terms as a product of volume of production and price.Index numbers play a vital role in adjusting the original data to reflect reality. If the subsequent year‟s industrial production were to be higher by 20% in value.

Eg : ii. differ between time periods or geographical locations or other characteristics such as income. etc. profession. Weightage . It is a statistic designed to help to compare how these prices. Price Index Price index is a an index that traces the relative changes in the price for a given class of goods or services in a given region. taken as a whole.a) i. during a given interval of time.

b) There are four ways of weightage representations. The value of the index is generated by adding the prices of each of the stocks in the index and dividing them by the total number of stocks. Stocks with a higher price will be given more weight and. iii. therefore. will have a greater influence over the performance of the index.Weightage is a stock index in which each stock influences the index in proportion to its price per share. Composite Index Composite index number is a number that measures an average relative changes in a group of relative variables with respect to a base. They are : .

so it is also called current year weighted index. . Paasche’s Index Number: In this index number. It is called ideal because it satisfies the time reversal and factor reversal test. so it also called base year weighted index. the current (given) year quantities are used as weights.Laspeyre’s Index Number: In this index number the base year quantities are used as weights. Fisher’s Ideal Index Number: Geometric mean of Laspeyre‟s and Paasche‟s index numbers is known as Fisher‟s ideal index number.

the average of the base year and current year quantities are used as weights. Example: Compute the weighted aggregative price index numbers for 2011 with 2010 as base year using : (1) Laspeyre’s Index Number (2) Paashe’s Index Number (3) Fisher’s Ideal Index Number (4) Marshal Edgeworth Index Number Commodity Prices 2010 2011 Quantities 2010 2011 .Marshal-Edgeworth Index Number: In this index number. This index number is proposed by two English economists Marshal and Edgeworth.

Solution: Prices Commodity 2010 2011 Quantity 2010 2011 Laspeyre’s Index Number Paashe’s Index Number .

Fisher’s Ideal Index Number Marshal Edgeworth Index Number .

Average Monthly Percentage of Expenditure for the monthly expenses year 2013 (to the nearest %) (to the nearest RM) 3000 36. The household expenditure for every family is different.2 8 5.Part 2 We often hear complaints from the public about inflation.1 1.6 100 Item Food Accommodation (Rental / Loan) Transportation (Petrol/Loan/Bus fare etc) Clothing Education Recreation Utilities (Water/Electricity/Telephone) Medication Miscellaneous TOTAL .4 12 0. It causes an increase in the household expenditure in a family.1 1000 12 2000 100 650 450 1000 50 50 8300 TABLE 1 24.6 0. a) My family‟s monthly expenditure for the year 2013.

Average Monthly Expenditure for the year 2010 as the base year (RM) 2500 1000 2000 80 525 380 1000 50 50 7585 TABLE 2 Average monthly expenses for the year 2013 (RM) 3000 1000 2000 100 650 450 1000 50 50 8300 Item Food Accommodation (Rental / Loan) Transportation (Petrol/Loan/Bus fare etc) Clothing Education Recreation Utilities (Water/Electricity/Telephone) Medication Miscellaneous TOTAL . ii. we have to calculate the price index that involves some of the items mentioned above. i. we have to consider the average monthly expenses of any previous year as the base year. In order to calculate the price index of all the items above.b) If we want to compare the cost of living from one year to another.

Item Food Accommodation (Rental / Loan) Transportation (Petrol/Loan/Bus fare etc) Clothing Education Recreation Utilities (Water/Electricity/Telephone) Medication Miscellaneous TOTAL Price indices for the year 2013 based on year 2010 120 100 100 125 124 118 100 100 100 987 TABLE 3 Weightage 60 20 40 2 13 9 20 1 1 166 .c) i.

ii.4 d) My family‟s expenditure based on my findings is the average monthly expenditure for the year 2013 increase by RM110. This is because some items in the year 2010 increased in the year 2013. I ∑ ⁄∑ 120(60)+100(20)+100(40)+125(2)+124(13)+118(9)+100(20)+100(1)+100(1) 60+20+40+2+13+9+20+1+1 18324 166 RM 110. .4 . Calculate the composite index for the average monthly expenditure in the year 2013 based on year 2010. Answer : Composite index .

3 1687. a) You have conducted a survey on the price of the television for two different brands from three different shops. cash payment and payment by installment.2 Samsung 32 650 650 600 633. Size of Price (RM) Mean Standard Brand Television Price Deviation Shop A Shop B Shop C (inches) (RM) (RM) 24 380 399 350 376.3 532.6 40 980 1300 1300 1193.4 Panasonic 32 500 700 1400 866.Part 3 Question 1 Your family is planning to buy a new television set.3 TABLE 4(a) . You would like to make a comparison between two modes of payment. namely.8 24 300 450 250 333. Table 4(a) shows the price of televisions by cash payment in three different shops whereas Table 4(b) shows the prices of televisions by installment.3 895.3 471.7 40 900 1900 2999 1933 2733.7 1225.

2 99.  Shop A sell with RM 900 which is my family are affordable to buy the television based on the money expenditure in Table 1.8 116.7 161.3 54.9 100.4 44.1 227.6 54.4 140.  Television with 40 inches in shop A is much cheaper than shop B and C and it is worth it.3 52.8 27.7 33.2 50 249.5 54.7 81.8 74.2 70.  My family also can pay the prices of television by installment and we can use other money for other uses.2 75 25 41.3 108.3 29.3 Mean Standard Price Deviation (RM) (RM) 31.9 20.8 39. sound and screen.3 37.6 TABLE 4(b) b) I have decided to buy a Samsung television with 40 inches from shop A because  Television with 40 inches has a good quality of the image . .6 108.Brand Samsung Panasonic Size of Television (inches) 24 32 40 24 32 40 Price (RM) Shop A Shop B Shop C 31.2 158.

the status of the shop. . No. consumers are able to buy the television at shop A. the shop that deserve the award is shop A. factors that influenced the prices of goods in the shops is such as the location of the shop.c) If I am the panels of the Fair Price Shop Award. the population of the customers. So. In my research. the size of the shop. shop A sell with reasonable price. I don‟t consider the value of mean and the value of standard deviation of television because based on the table mean and standard deviation is based on 3 shops. Therefore I assume that. and the rent for the shop.

6 100 SOLUTIONS I choose to pay the television by installment.6 0. your family needs to make some adjustment on the various types of expenditure.1 1.2 12 24. Average Monthly Item Expenditure for the year 2013 (to the nearest RM) Food Accommodation (Rental / Loan) Transportation (Petrol/Loan/Bus fare etc) Clothing Education Recreation Utilities (Water/Electricity/Telephone) Medication Miscellaneous TOTAL 50 50 8375 100 650 450 1075 2000 3000 1000 Percentage of monthly expenses (to the nearest %) 36.2 7.Part 4 Question 2 a) Your family has a fixed monthly income. .3 5 13 0. In order to buy the television.

9 6 4 9 0. Plan your monthly expenditure in a Table 1 above and add other items such as savings and contributions to your parents.3 20. Item Food Accommodation (Rental / Loan) Transportation (Petrol/Loan/Bus fare etc) Clothing Education Recreation Utilities (Water/Electricity/Telephone) Medication Miscellaneous Savings Contributions TOTAL Average Monthly Percentage of Expenditure for monthly expenses the year 2013 (to the nearest %) (to the nearest RM) 3000 28 1000 9 2000 100 650 450 1000 50 50 250 2250 10800 19 0.5 0.b) Assuming you have just started working with a monthly salary of RM2500.5 2.8 100 . You intend to save 10% of your salary every month.

I always thought that you will be my greatest obstacle and rival in excelling in my life... days and night to finish this project and also sacrificing my time video games and magazine in this mid year holiday.. And .......... From the day I born. You are my real friend. Sacrificing my Anime... From the day I start learning... After sacrificing my precious time just for you.... Countless of nights . I really love you.. Sacrificing my magazine.... You are my soulmate.. You my partner. From the day I heard your name. Sacrificing my Video Games. I LOVE U ADDITIONAL MATHEMATICS. Sacrificing my Facebook ........... .REFLECTION After spending countless hours... Countless of days .... From the day I was able to holding pencil. But after countless of hours. there are several things that I can say... Sacrificing my Computer Games..... Sacrificing my Internet.. I realized something really important in you.

parents can be a good role model by demonstrate to their children on how to spend money wisely . parents should plan their family‟s financial in order to have stability in life. Financial backup when job changes occur.CONCLUSION After doing research. Help families get the right insurance. answering questions. Therefore. b. Also. Estate planning for families. As a result. c. In connection. f. Help them stabilize and cope with challenges that are associated with that stage of life. if one family make a planning of their financial expenditures. d. e. Boost household savings and investments. we can conclude that the planning of money expenditure for the family is important. . g. complete the table and all the problem solving. it will give them many advantages such as :a. Assist in retirement planning. The changes will protect their family and make it possible to still reach their financial goals even with the added expenses of children in their life. the family would not face any critical financial problems and their childrens will have a quality life for their future.