CHAPTER 11 : INDEX NUMBER EXPRESS NOTES

1. Index Number , I
I= Q1 X 100 Q0

Where Q0 = Quantity at the base year Q1 = Quantity at specific year

Altern t!"e Met#$d: U%!n& Index B$x

Base Year

Specific Year

Q0
ada perkataan 'base year', index number or price index mesti 100

Q1 I

row for Quantity, Price etc row for price index, index number

100

Q0 Q1 = or Q0 xI =100Q1 100 I

'. C$m($%!te Index,

I =

I W W
i i

where Ii = Price Index Wi = weightage

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Q1: The mean electric bill of li increases from !"#$0 a month in $00% to !"%&0 a month in $00'( )alculate the index number of the electric bill of li in $00' based on $00%(
200! 200

)1

420 100
#$0 I = 100 x %&0 %&000 I = #$0 I = 1*0

630 I

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+,)TI-. ) )1*: INDEX NUMBER TIPS Table & shows the prices and the price indices for four ingredients/ 0/ 1/ 2 and "/ used in ma3ing particular +T,P+: 3ind of ca3es( 4iagram % is bar chart which represents the relati5e amount of the ingredients 0/ 1/ 2 and "/ 1( To find Index .umber/ I used in ma3ing these ca3es( =se the formula: Q I = 1 X 100 or Prices per Prices Index Q0 3g6!"7 for the for year Ingredi year $008 based >ase year +pecific year ants on year$00& $00& $008 Q0 Q1 0 0(#0 0(%0 1*0 100 I 1 a 0(#0 90 2 $(00 b 1#0 Q0 Q = 1 / therefore " 0(90 1(00 c 100 I Table & Q I = 1 X 100 Q0 Where: I = Index .umber 1"0 Q0 Q! = Quantity ? Price 120 100 #0
Amount !0 Used

"0 20 0 $ % & Ingredients 4iagram % '

a7 :ind the 5alues of a/ b and c( b7 i7 )alculate the composite index for the cost of ma3ing these ca3es in year $008 based on the year $00&( ii7 ;ence/ calculate the corresponding cost of ma3ing these ca3es in the year $00& if the cost in the year $008 was !" &1$*( c7 The cost of ma3ing these ca3es is expected to increase by #0< from the year $008 to the year $009( :ind the expected composite index for the year $009 based on the year $00&( +-2=TI-.:
2 2

$( )omposite Index/ >ase year Q0 100

@@

I =

I " "
i i

or

+pecific year Q1
@@

a7 S FO R Search, Strategy, Formula, Operation, Output, Re-check &( The 5alue of weightage/ wi// usually $00& $008 gi5en in types of bar chart/ pie chart/ a 0(#0