Question

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

Commodity	Base Year		Current Year
	Price	Quantity	Price	Quantity
A	30	22	40	18
B	40	16	60	12
C	10	38	15	24
D	50	12	60	16
E	20	28	25	36

Answer 1

Commodity	Base year		Current year		p0q0	p1q1
	p0	q0	p1	q1
A	30	22	40	18	660	720
B	40	16	60	12	640	720
C	10	38	15	24	380	360
D	50	12	60	16	600	960
E	20	28	25	36	560	900
Total	-	-	-	-	∑p0q0 = 2840	∑p1q1 = 3660

Here, p₀ = Price in base year. 

p₁ = Price in current year,

q₀ = Quantity of base year and

q₁ = Quantity of the current year.

From the table, `sum p_0q_0 = 2840, sump_1q_1 = 3660`

Value Index Number (V₀₁) = `(sump_1q_1)/(sum p_0q_0) xx 100`

`= 3660/2840 xx 100`

= 1.2887 × 100

= 128.87

Hence, the Value Index Number is 128.87.