# Calculate Walsh’s price Index Number for the following data. Commodity Base Year Current Year Price Quantity Price Quantity I 10 12 40 3 II 20 2 25 8 III 30 3 50 27 IV 60 9 90 36 - Mathematics and Statistics

Chart
Sum

Calculate Walsh’s price Index Number for the following data.

 Commodity Base Year Current Year Price Quantity Price Quantity I 10 12 40 3 II 20 2 25 8 III 30 3 50 27 IV 60 9 90 36

#### Solution

Construct the following table:

 Commodity BaseYear CurrentYear sqrt("q"_1"q"_1) "p"_0sqrt("q"_0"q"_1) "p"_1 sqrt("q"_0"q"_1) p0 q0 p1 q1 I 10 12 40 3 6 60 240 II 20 2 25 8 4 80 100 III 30 3 50 27 9 270 450 IV 60 9 90 36 18 1080 1620 Total – – – – – 1490 2410

From the table, sum"p"_0 sqrt("q"_0"q"_1) = 1490, sum"p"_1sqrt("q"_0"q"_1) = 2410

Walsh’s Price Index Number:

P01(W) = (sum"p"_1sqrt("q"_0"q"_1))/(sum"p"_0sqrt("q"_0"q"_1)) xx 100

= 2410/1490 xx 100

= 161.74

Concept: Construction of Index Numbers - Weighted Aggregate Method
Is there an error in this question or solution?
Chapter 2.5: Index Numbers - Q.4
Share