Maharashtra State BoardHSC Commerce 12th Board Exam
Advertisement Remove all ads

Base year weights (W) and current year price relatives (I) are given in Problem. Calculate the cost of living index in: Find y if the cost of living index is 200. - Mathematics and Statistics

Sum

Base year weights (W) and current year price relatives (I) are given in Problem. Calculate the cost of living index in:

Find y if the cost of living index is 200.

Group Food Clothing Fuel & Lighting House Rent Miscellaneous
I 180 120 160 300 200
W 4 5 3 y 2
Advertisement Remove all ads

Solution

Group I W IW
Food 180 4 720
Clothing 120 5 600
Fuel & Lighting 160 33 480
House Rent 300 y 300y
Miscellaneous 200 2 400
Total y + 14 300y + 2200

From the table,
`sum"W" = y + 14, sum"IW" = 300y + 2200`
Now, by Family Budget Method,

CLI = `(sum"IW")/(sum"W")`

∴ 200 = `(300y + 2200)/(y + 14)`      ...[∵ CLI = 150]

∴ 200y + 2800 = 300 +2200
∴ 300y – 200y = 2800  – 2200
∴ 100y = 600
∴ y = `(600)/(100)`
∴ y = 6.

Concept: Method of Constructing Cost of Living Index Numbers - Family Budget Method
  Is there an error in this question or solution?
Advertisement Remove all ads

APPEARS IN

Advertisement Remove all ads
Advertisement Remove all ads
Share
Notifications

View all notifications


      Forgot password?
View in app×