Question

Find the Price Index Number using Simple Aggregate Method in the following example.

Use 1995 as base year in the following problem.

Commodity	A	B	C	D	E
Price (in ₹) in 1995	42	30	54	70	120
Price (in ₹) in 2005	60	55	74	110	140

Answer 1

Commodity	Price in 1995 (Base year) p0	Price in 2005 (Current year)p1
A	42	60
B	30	55
C	54	74
D	70	110
E	120	140
Total	316	439

From the table, ∑ p₀ = 316, ∑ p₁ = 439

Price Index Number (P₀₁) = `(sum "p"_1)/(sum "p"_0) xx 100`

`= 439/316 xx 100`

= 138.92