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STA110 (Chain Index Method)

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19 views1 page

STA110 (Chain Index Method)

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muchesiaseth
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135 of Chain Index Method The chain method provides a direct comparison between each year and the preceding year and it is in such terms that a businessman often thinks. The chain base method allows the addition of new commodities. removal of old commodities or the substitution of one commodity for another. It is possible to change the geographical coverage or the weight of a commodity to meet changing conditions. (iv) It satisfies the so-called circular test. ‘An index with a fixed period can be computed by the ‘product of tink Merits a i) (iti) (v) a. relatives. Demerits of Chain Indi Method a (i) ee ee pasional procedure of chains indices is relatively : (ii) Fran error is committed during the chaining, process. t wl be amet through the entire series. igi ia an te

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