PART 1 a) Describe in brief (i) Price Index Price index is an index that traces the relative changes in the

e price of an individual good over time.

(ii) Weightage Weightage is the assignment of a quota to a particular segment of the population as a special favor or concession in a proportion above that is allowable on a strictly numerical basis.

(iii) Composite Index A grouping of equities, indexes or other factors combined in a standardized way, providing a useful statistical measure of overall market or sector performance over time. b) State four ways of weightage representations. Find the examples of representations using the internet or any printed materials.

(i) Pie Chart

(ii) Bar Graph

(iii) Line Graph

(iv) Histogram

PART 2 We often hear complaints from the public about inflation. It causes an increase in the household expenditure in a family. The household expenditure for every family is different. a) Complete table 1 for your familys monthly expenditure for the year 2013 Average Monthly Expenditure for the year 2013 (to the nearest RM) 1100 Percentage of monthly expenses (to the nearest %) 11.0

Monthly salary

Number of family members

Item

Food Accomodation (Rental / Loan)

100

1.0

Transportation (Petrol/ Loan / Bus fare etc)

1000

10.0

Clothing RM 10000 4 Education Recreation Utilities (Water / Electricity / Telephone)

800 1200 500

8.0 12.0 5.0

700

7.0

Medication Miscellaneous TOTAL

300 4300 10000

3.0 43.0 100

(b) If we want to compare the cost of living from one year to another, we have to calculate the price index that involves some of the items mentioned above. (i) In order to calculate the price index of all the items above, we have to consider the average monthly expenses of any previous year as the base year. Select the appropriate year as the base year. Average Monthly Expenditure for the base year 2012 (RM) 1000 100

Item

Food Accomodation (Rental / Loan) Transportation (Petrol/ Loan / Bus fare etc) Clothing Education Recreation Utilities (Water / Electricity / Telephone) Medication Miscellaneous TOTAL

1200

600 1000 100 1000

800 2200 8000

(ii) Hence, complete Table 2 below Average monthly expenses for the year 2012 as the base year (RM) 1000 Average monthly expenses for the year 2013 (RM)

Item

Food Accomodation (Rental / Loan) Transportation (Petrol / Loan / Bus fare etc)

1100

100

100

1200

1000

Clothing

600

800

Education

1000

1200

Recreation Utilities (Water / Electricity / Telephone) Medication

100

500

1000

700 300

800

Miscellaneous TOTAL

2200 8000

4300 10000

(c) ( i) Complete Table 3 based on the above information. Item Price indices for the year 2013 based on the year 2008 110.00 Weightage

Food Accomodation (Rental / Loan)

8.2

100.00

7.4

Transportation (Petrol / Loan / Bus fare etc)

83.33

6.2

Clothing

133.33

9.9

Education

120.00

8.9

Recreation Utilities (Water / Electricity / Telephone)

500.00

37.0

70.00

5.2

Medication

37.50

2.8

Miscellaneous

195.45

14.4

TOTAL

1349.61

100

Formula to calculate price index:

(ii) Hence, calculate the composite index for the average monthly expenditure in the year 2013 based on the selected base year. Formula to calculate composite index:

(110 x 8.2) + (100 x 7.4) + ( 83.33 x 6.2) + (133.3 x 9.9) + (120 x 8.9) + ( 500 x 37) + (70 x 5.2) + ( 37.5 x 2.8) + (195.45 x 14.4)

8.2 + 7.4 + 6.2 + 9.9 + 8.9 + 37 + 5.2 + 2.8 + 14.4 = 263.30

(d) Make a conclusion about your family's expenditure based on your findings. Based on the findings, I found that the average expenses for the current year is higher than the base year 2012. We spent a total of RM 500 on recreation in 2013 compared to RM 100 in 2012. Other expenses such as food, clothing, education and miscellaneous expenses also increased. This is due to the high inflation rate.

Part 3 Your Family is planning on buying a new television set. (a) You have conducted a survey on the price of the television for two different brands from three different shops. You would like to make a comparison between two modes of payment, namely, cash payment and payment by installment. Table 4(a) shows the prices of the television by cash payment in three different shops whereas table 4(b) shows the prices of televisions payed by installment. Price (RM) Brand Size of Television (inches) Mean Price (RM) Standard Deviation (RM)

Ali & Abus Shop

TS

SH

24 32 40 24 32 40

Sripathy Electronics & Hardware 988 788 1788 1599 2888 2500 788 699 969 848 1288 1269 Table 4(a)

Kedai Elektrik Ah Loi 888 1690 2300 999 1200 1499

888.00 1693.33 562.67 828.67 1005.67 1352.00

81.65 1685.61 2512.02 125.78 1010.70 104.23

Price (RM) Brand Size of Television (inches) Sripathy Electronics & Hardware 1383.2 945.6 2503.2 1918.8 4043.2 3000.0 1103.2 838.8 1356.6 1017.6 1803.2 1522.8 Table 4(b) Ali & Abus Shop Mean Price (RM) Standard Deviation (RM)

Kedai Elektrik Ah Loi 1154.4 2197.0 2990.0 1298.7 1560.0 1948.7

TS

SH

24 32 40 24 32 40

1161.07 2206.33 3344.40 1080.23 1311.40 1758.23

178.69 238.70 494.14 188.47 223.73 176.79

The mean and standard deviation can be calculated using the following formula:

(b) Determine the brand and the size of the television that you have decided to buy. Give your reasons based on the findings from part (a). Answer: I want to buy a 32-inch TS television. This is because there are only four members in my family and we only require a medium sized television for our living room. I choose this brand because I am confident of its quality as our family has been using this brand for quite a long time. We also use this brand for other electronical appliances in our home. Although it is more expensive than the SH brand, my family can still afford to buy it. I plan to buy this television set from Ramli Electronics & Hardware store because they offer 2 years of warranty. In addition, they are offer the lowest price of televisions compared to the other two shops.

(c) The Ministry of Domestic Trade and Consumer Affairs wishes to present the Fair Price Award to one of he above shops. If you are on of the panels for this award, determine the shop that deserves the award. Do you consider the value of the mean and the value of the standard deviationin making your decision? Give your justifications. Answer: If I am one of the panel for the award, I would prefer Ramli Electronics & Hardware shop because the mean price for all types of television for both brands are the lowest compared to the other two shops. Standard deviation for the televisions at the shop are also the lowest. It shows that the price of the television offered by the Ramli Eletronics & Hardware shop is reasonable and affordable.

Part 4 (a) Your family has a fixed monthly income. In order to buy a television, your family needs to make some adjustments on the various types of expenditure. Show the average monthly expenditure that you have modified in a table

Item

Average Monthly Modified expenditure Expenditure (RM) (RM)

Food Accomodation (Rental / Loan)

1100

1100

100

100

Transportation (Petrol/ Loan / Bus fare etc) Clothing Education Recreation Utilities (Water / Electricity / Telephone) Medication Miscellaneous Television TOTAL

1000

1000

800 1200 500

300 1200 300

700

400

300 4300 10000

300 3800 1500 10000

(b) Assuming you just started working with a monthly salary of RM2500. You intend to save 10% of your salary every month. Plan your monthly expenditure as in Table 1 above and add other items such as savings and contribution to your parents.

Item

Average Monthly Expenditure (RM)

Food Accomodation (Rental / Loan)

400

300

Transportation (Petrol/ Loan / Bus fare etc)

200

Clothing Education Recreation Utilities (Water / Electricity / Telephone) Medication Savings Parents Miscellaneous TOTAL

100 100 50

100 100 250 600 300 2500

Further Exploration AIR POLLUTION INDEX The Air Pollution Index (API) is a simple and generalized way to describe the air quality in China, Hong Kong and Malaysia. It is calculated from several sets of air pollution data. In mainland Chine the API was replace by an updated Air Quality Index in early 2012. API Mechanics An individual score is assigned to the level of each pollutant and the final API is the highest of those 5 scores. The pollutants can be measured quite differently. The API level is based on the level of 5 atmospheric pollutants namely sulfur dioxide (SO2), nitrogen dioxide (NO2), suspended particulates (PM10), carbon monoxide (CO) and ozone (O3) measured at the monitoring stations throughout each city. The scale for each pollutant is non-linear, as is the final API score. Thus, an API of 100 does not mean twice the pollution of API at 60, nor does it mean twice as harmful.

API and Health Implications

Causes Of Poor Air Quality The API can worsen due to lack of dilution of air emissions by fresh air. Stagnant air often caused by anticyclone or temperature inversion enables air pollution to remain in a local area.

INTRODUCTION INDEX NUMBER Index numbers are meant to study the change in the effects of factors that cannot be measured directly. For example, 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. Index numbers are commonly used statistical device for measuring the combined fluctuations in a group related variables. If we wish to compare the price level of consumer items today with that prevalent ten years ago, we are not interested in comparing the prices of only one item, but in comparing some sort of average price levels. We may wish to compare the present agricultural production or industrial production with that at the time of independence. Here again, we have to consider all items of production and each item may have undergone a different fractional increase (or even a decrease). How do we obtain a composite measure? 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, with a view to obtain a figure that represents the net result of the change in the constitute variables. Index numbers may be classified in terms of the variables that they are intended to measure. In business, different groups of variables in the measurement of which index number techniques are commonly used are price, quantity, value and business activity. Here we shall be mainly interested in index numbers of prices showing changes with respect to time, although methods described can be applied to other cases. In general, the present level of prices is compared with the level of prices in the past. The present period is called the current period and some period in the past is called the base period.

Index Numbers: Index numbers are statistical measures designed to show changes in a variable or group of related variables with respect to time, geographic location or other characteristics such as income, profession, etc. A collection of index numbers for different years, locations, etc., is sometimes called an index series. Simple Index Number: A simple index number is a number that measures a relative change in a single variable with respect to a base. Composite Index Number: A composite index number is a number that measures an average relative changes in a group of relative variables with respect to a base.

Types of Index Numbers: Following types of index numbers are commonly used: Price index Numbers: Price index numbers measure the relative changes in prices of a commodities between two periods. Prices can be either retail or wholesale. Quantity Index Numbers: These index numbers are considered to measure changes in the physical quantity of goods produced, consumed or sold of an item or a group of items.

ADDITIONAL MATHEMATICS PROJECT 2013

Name : Iman Binti. Shiraz Mikael Khan Class : 5 Science Belian Teacher : Puan Annie Sundari Title : Index Number (Project 2)