Goods 1981 1983 1981 1983

P0 p1 q0 q1 P0*q0
A 50 75 25 45 1250
B 60 75 56 33 3360
C 200 240 10 12 2000
D 80 100 80 120 6400
E 800 1000 3 5 2400

SUM 15410

Price Index

Laspeyre's L=P1*q0/p0*q0 1.26379

Paasche's P=p1*q1/p0*q1 1.271873

Fisher F=(L*P)^1/2 1.267825

Dorbish and Bowley (L+P)/2 1.267832

Marshall-Edgeworth Price Index (p1*(q0+q1)/2)÷(p0((q0+q1)/2) 1.268378

TIME REVERSAL TEST

Laspeyre's L=(p1qo/p0q0)*(poq1/p1q1) 0.993644 ≠1

Paasche's P=(p1*q1/p0*q1)(p0*q0/p1*q0) 1.006396 ≠1

Fisher F=(L*P)^1/2 1
Note Fisher Index satisfied both time and factor reversal tests
P1*q0 p1*q1 p0*q1 (q0+q1)/2 p1*(q0+q1)/2 p0*(q0+q1)/2
1875 3375 2250 35 2625 ###
4200 2475 1980 44.5 3337.5 ###
2400 2880 2400 11 2640 ###
8000 12000 9600 100 10000 ###
3000 5000 4000 4 4000 ###

19475 25730 20230 194.5 22602.5 ###

QUANTITY INDEX

L=poq1/p0q0 1.312783906554

P=p1q1/p1q0 1.321181001284

F=(poq1/p0q0)*p1q1/p1q0)^1/21.316975761406

FACTOR REVERSAL TEST

Price Index * Quantity Index

L=(P1*q0/p0*q0)*(poq1/p0q0) 1.659082841022 ≠ p1q1/poqo = 1.669695

P=(p1*q1/p0*q1)*(p1q1/p1q0) 1.680375045132 ≠ p1q1/p0q0 = 1.669695

F=(L*P)^1/2 1.669695003245 = p1q1/p0q0 = 1.669695

Consider the following table which recorded quntity of goods and their respective prices
2019 2020
Goods p0 q0 p1 q1

1 7.144216 254.2884 17.13946 354.2884

2 12.14753 264.2951 4.631179 364.2951
3 20.26925 280.5385 15.67312 380.5385
4 30.2452 300.4904 40.613 400.4904
5 36.67662 313.3532 56.69156 413.3532
6 25.96948 291.939 29.92371 391.939
7 36.86325 313.7265 57.15813 413.7265
8 13.73696 267.4739 0.657596 367.4739
9 35.48437 310.9687 53.71092 410.9687
10 20.5288 281.0576 16.32199 381.0576
11 36.04534 312.0907 55.11336 412.0907
12 54.09106 348.1821 100.2276 448.1821
13 32.46544 304.9309 46.16359 404.9309
14 30.09907 300.1981 40.24767 400.1981
15 26.19663 292.3933 30.49157 392.3933
16 27.40264 294.8053 33.50661 394.8053
17 17.99608 275.9922 9.990199 375.9922
18 11.40311 262.8062 6.492232 362.8062
19 34.63218 309.2644 51.58045 409.2644
20 22.92413 285.8483 22.31033 385.8483
21 29.43552 298.871 38.58881 398.871
22 22.18733 284.3747 20.46832 384.3747
23 29.56115 299.1223 38.90287 399.1223
24 21.49252 282.985 18.7313 382.985
25 18.64223 277.2845 11.60558 377.2845
26 38.03361 316.0672 60.08403 416.0672
27 43.40386 326.8077 73.50965 426.8077
28 26.09777 292.1955 30.24442 392.1955
29 38.1653 316.3306 60.41324 416.3306
30 21.41648 282.833 18.54121 382.833
31 22.70328 285.4066 21.75821 385.4066
32 30.55758 301.1152 41.39394 401.1152
33 30.99958 301.9992 42.49895 401.9992
34 14.08034 268.1607 0.200853 368.1607
35 33.15713 306.3143 47.89282 406.3143
36 32.69717 305.3943 46.74294 405.3943
37 55.26031 350.5206 103.1508 450.5206
38 19.05116 278.1023 12.6279 378.1023
39 26.25907 292.5181 30.64767 392.5181
40 31.88571 303.7714 44.71428 403.7714
 41 26.69133 293.3827 31.72832 393.3827
42 41.97409 323.9482 69.93522 423.9482
43 25.35589 290.7118 28.38973 390.7118
44 30.77148 301.543 41.9287 401.543
45 29.31518 298.6304 38.28796 398.6304
46 12.91742 265.8348 2.706461 365.8348
47 25.12456 290.2491 27.81141 390.2491
48 30.95885 301.9177 42.39712 401.9177
49 25.44857 290.8971 28.62143 390.8971
50 27.44456 294.8891 33.6114 394.8891

a. Find nominal and real GDP of coountry Z

b. Suppose that population in 2019 is 200 Million and in 2020 it is 250 Millio. Find Real GDP percapita

c. Find nominal and real GDP of country Z assuming 2020 is a base year and also find GDP deflator

d. Pick 20 quantities of your choice and formed a basket of goods (each student should has her own basket)

e. Use your basket and calculate

(i) Laspeyre's price index

(ii) Paasche's price index
(iii) Fisher Price Index

(iv) Laspery's quantity index

(v) Paashe's quantity index
(vi) Fisher quantity Index

(vii) Perform time reversal and factor reversal tests on your index numbers.

(viii) based on your price and quantity find inflation rate and growth rate of output

(ix) Calculate inflation rate and growth rate of output without using index numbers. Which method is better? Expa

(x) find( Σ(p1/p0))/50 and give economic interpretation of your result

(xi) find (Σ(q1/q0))/50 and give economic interpretation of your result

their respective prices of country Z.
eal GDP percapita

GDP deflator

uld has her own basket)

Which method is better? Expalin your answer