Question

Calculate Walsh’s Price Index Number for the following data:

Commodity	Base Year		Current year
	Price	Quantity	Price	Quantity
L	4	8	3	2
M	6	16	8	9
N	8	18	7	32

Answer 1

Commodity	Base Year		Current year		q0q1	`bb(sqrt(q_0q_1))`	`bb(p_1sqrt(q_0q_1))`	`bb(p_0sqrt(q_0q_1))`
	Price	Quantity	Price	Quantity
	p0	q0	p1	q1
L	4	8	3	2	16	4	12	16
M	6	16	8	9	144	12	96	72
N	8	18	7	32	576	24	168	192
						Total	276	280

Walsh’s Price Index Number

P₀₁ (W) = `(sumP_1sqrt(q_0q_1))/(sumP_0sqrt(q_0q_1))xx100`

= `276/280xx100`

= `69/70xx100`

= 98.5714