Given the following data- Year CPI of industrial workers ( 1982 = 100 ) CPI of agricultural labourers ( 1986 = 100 ) WPI ( 1993 - 94 = 100 ) 1995 - 96 313 234 121 . 6 1996 - 97 342 256 127 . 2 1997 - 98 366 264 132 . 8 1998 - 99 414 293 140 . 7 1999 - 00 428 306 145 . 3 2000 - 01 444 306 155 . 7 2001 - 02 463 309 161 . 3 2002 - 03 482 319 166 . 8 2003 - 04 500 331 175 . 9 Comment on the relative values of the index numbers.

(a) Inflation using CPI of Industrial Workers Year CPI of industrial workers ( 1982 = 100 ) Inflation Rate (in % ) = A 2 - A 1 A 1 × 100 1995 - 96 313 313 - 100 100 × 100 = 213 1996 - 97 342 342 - 100 100 × 100 = 242 1997 - 98 366 366 - 100 100 × 100 = 266 1998 - 99 414 414 - 100 100 × 100 = 314 1999 - 00 428 428 - 100 100 × 100 = 328 2000 - 01 444 444 - 100 100 × 100 = 344 2001 - 02 463 463 - 100 100 × 100 = 363 2002 - 03 482 482 - 100 100 × 100 = 382 2003 - 04 500 500 - 100 100 × 100 = 400 (b) Inflation using CPI of Non-maunal Employees Year CPI of Non-manual Employees ( 1984 - 85 = 100 ) Inflation Rate (in % ) = A 2 - A 1 A 1 × 100 1995 - 96 257 257 - 100 100 × 100 = 157 1996 - 97 283 283 - 100 100 × 100 = 183 1997 - 98 302 302 - 100 100 × 100 = 202 1998 - 99 337 337 - 100 100 × 100 = 237 1999 - 00 352 352 - 100 100 × 100 = 252 2000 - 01 352 352 - 100 100 × 100 = 252 2001 - 02 390 390 - 100 100 × 100 = 290 2002 - 03 405 405 - 100 100 × 100 = 305 2003 - 04 420 420 - 100 100 × 100 = 320 (c) Inflation using CPI of Agricultural Labourers Year CPI of Agricultural Labourers ( 1986 - 87 = 100 ) Inflation Rate (in % ) = A 2 - A 1 A 1 × 100 1995 - 96 234 234 - 100 100 × 100 = 134 1996 - 97 256 256 - 100 100 × 100 = 156 1997 - 98 264 264 - 100 100 × 100 = 164 1998 - 99 393 293 - 100 100 × 100 = 193 1999 - 00 306 306 - 100 100 × 100 = 206 2000 - 01 306 306 - 100 100 × 100 = 206 2001 - 02 309 309 - 100 100 × 100 = 209 2002 - 03 319 319 - 100 100 × 100 = 219 2003 - 04 331 331 - 100 100 × 100 = 231 (d) Inflation using WPI Year WPI ( 1993 - 94 = 100 ) Inflation Rate (in % ) = A 2 - A 1 A 1 × 100 1995 - 96 121 . 6 121 . 6 - 100 100 × 100 = 21 . 6 1996 - 97 127 . 2 127 . 2 - 100 100 × 100 = 27 . 2 1997 - 98 132 . 8 132 . 8 - 100 100 × 100 = 32 . 8 1998 - 99 140 . 7 140 . 7 - 100 100 × 100 = 40 . 7 1999 - 00 145 . 3 145 . 3 - 100 100 × 100 = 45 . 3 2000 - 01 155 . 7 155 . 7 - 100 100 × 100 = 55 . 7 2001 - 02 161 . 3 161 . 3 - 100 100 × 100 = 61 . 3 2002 - 03 166 . 8 166 . 8 - 100 100 × 100 = 66 . 8 2003 - 04 175 . 9 175 . 9 - 100 100 × 100 = 75 . 9 The inflation rate calculated using CPI industrial worker with the base year 1982 is the highest and inflation rate calculated using WPI with the base year 1993 - 94 is the least.

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Important Questions on Index Numbers

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Economics>Statistics in Economics>Index Numbers>Index Numbers and their Construction

If the salary of a person in the base year is Rs.

4000

per annum and the current year salary is Rs.

6000

, by how much should his salary be raised to maintain the same standard of living if the CPI is

400

MEDIUM

Economics>Statistics in Economics>Index Numbers>Index Numbers and their Construction

Read the following table carefully and give your comments on the index of industrial production.

EASY

Economics>Statistics in Economics>Index Numbers>Index Numbers and their Construction

A consumer price index measures changes in

MEDIUM

Economics>Statistics in Economics>Index Numbers>Index Numbers and their Construction

The impact of change in the price of a commodity with little weight in the index will be

MEDIUM

Economics>Statistics in Economics>Index Numbers>Index Numbers and their Construction

The item having the highest weight in consumer price index for industrial workers is

EASY

Economics>Statistics in Economics>Index Numbers>Index Numbers and their Construction

The impact of change in the price of a commodity with little weight in the index will be:

HARD

Economics>Statistics in Economics>Index Numbers>Index Numbers and their Construction

Given the following data-

Year	CPI of industrial workers $(1982 = 100)$	CPI of agricultural labourers $(1986 = 100)$	WPI $(1993 - 94 = 100)$
$1995 - 96$	$313$	$234$	$121.6$
$1996 - 97$	$342$	$256$	$127.2$
$1997 - 98$	$366$	$264$	$132.8$
$1998 - 99$	$414$	$293$	$140.7$
$1999 - 00$	$428$	$306$	$145.3$
$2000 - 01$	$444$	$306$	$155.7$
$2001 - 02$	$463$	$309$	$161.3$
$2002 - 03$	$482$	$319$	$166.8$
$2003 - 04$	$500$	$331$	$175.9$

Comment on the relative values of the index numbers.

HARD

Economics>Statistics in Economics>Index Numbers>Index Numbers and their Construction

A simple aggregate _____ index is used to _____.

MEDIUM

Economics>Statistics in Economics>Index Numbers>Index Numbers and their Construction

The monthly per capita expenditure incurred by workers for an industrial centre during 1980 and 2005 on the following items are given below. Prepare a weighted index number for cost of living for 2005 with 1980 as the base.

EASY

Economics>Statistics in Economics>Index Numbers>Index Numbers and their Construction

In general, inflation is calculated by using

MEDIUM

Economics>Statistics in Economics>Index Numbers>Index Numbers and their Construction

In most of the weighted index numbers, the weight pertains to

MEDIUM

Economics>Statistics in Economics>Index Numbers>Index Numbers and their Construction

In general, inflation is calculated by using

EASY

Economics>Statistics in Economics>Index Numbers>Index Numbers and their Construction

An index number which accounts for the relative importance of the items is known as