Maharashtra State BoardHSC Commerce 12th Board Exam
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Calculate the cost of living index in problem - Mathematics and Statistics

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Sum

Calculate the cost of living index in problem

Group Base Year Current Year
  Price Quantity Price
Food 40 15 45
Clothing 30 10 35
Fuel & Lighting 20 17 25
House Rent 60 22 70
Miscellaneous 70 25 80
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Solution

Group Base Year Current Year p1q0 p0q0
  p0 q0 p1    
Food 40 15 45 675 600
Clothing 30 10 35 350 300
Fuel & Lighting 20 17 25 425 340
House Rent 60 22 70 1540 1320
Miscellaneous 70 25 80 2000 1750
Total 4990 4310

From the table
`sum"p"_1"q"_0 = 4,990, sum"p"_0"q"_0 = 4,310`
Now, by Aggregate Expenditure Method,

CLI = `(sum"p"_1"q"_0)/(sum"p"_0"q"_0) xx 100`

= `(4990)/(4310) xx 100`
= 115.78

Concept: Method of Constructing Cost of Living Index Numbers - Aggregative Expenditure Method
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