Scribd
Upload
22 views2 pages

Tutorial For Index 2025

The document contains tutorial questions for a course on Business Statistics, focusing on index numbers. It covers applications, construction problems, and various types of index numbers such as Simple Average Price Relative, Simple Aggregate, and Weighted Aggregate Index Numbers. Additionally, it includes practical exercises for calculating different index numbers using provided data for prices and quantities over specified years.

Uploaded by

deniskanuti14
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
22 views2 pages

Tutorial For Index 2025

The document contains tutorial questions for a course on Business Statistics, focusing on index numbers. It covers applications, construction problems, and various types of index numbers such as Simple Average Price Relative, Simple Aggregate, and Weighted Aggregate Index Numbers. Additionally, it includes practical exercises for calculating different index numbers using provided data for prices and quantities over specified years.

Uploaded by

deniskanuti14
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 2

THE INSTITUTE OF FINANCE MANAGEMENT (IFM)

Department of Mathematics and Actuarial Studies


MTU 07203: Business Statistics
Tutorial Questions for Index Numbers: 19th - 30 MAY, 2025

QUESTION ONE
i) What are the applications of index numbers in real life?
ii) Describe at least five problems in Index Number Construction
iii) What is a Simple Average Price Relative Index Number? How is it calculated?
iv) Explain the Simple Aggregate Index Number. In what situations might it be used?
v) Differentiate between the Simple Aggregate Index Number and the Simple Average Price
Relative Index Number.
vi) What is meant by a Weighted Aggregate Index Number? Why are weights important in index
number construction?
vii) Explain the Laspeyres Price Index and how it is different from the Paasche Price Index
viii) Compare and contrast Laspeyres and Paasche Index Numbers in terms of their
assumptions, data requirements, and accuracy.
ix) Why is it preferable to use a Weighted Index Number in most real-world applications instead
of a simple index?
x) Provide an example where a Laspeyres index might significantly overstate inflation
compared to the Paasche index. Explain why this occurs.

QUESTION TWO
Using the information in the table construct index numbers for
Prices in TSHS
Item
2020 2025
wheat (1kg) 1200 2000
Onions (0.5kg) 1500 2500
Juice (1 liter) 1750 3000

Calculate the simple average of relative price index of 2025 use 2020 as base year.

1
QUESTION THREE
The average price in Tshs for maize, wheat and sugar for the two years 2015 and 2025 are given
in table
Item 2015 2025
1kg of Maize 650 1200
1kg of wheat 1000 2000
1kg of sugar 1200 1800

Calculate the simple aggregate price index for the year 2015 using 2025 as a base period.

QUESTION FOUR
For my shares. I have a small portfolio of shares in Companies A, B and C.
2021 2025
Price Quantity Price Quantity
Company A 70 1500 300 2000
Company B 90 950 350 1550
Company C 110 700 100 1200
Use 2021 as the base period and 2025 as current time to
(a) Determine the Laspeyres’ price index.
(b) Determine the Laspeyres’ Quantity index
(c) Determine the Paasche index.
(d) Determine Fisher’s ideal price index.
(e) Determine the base period weighted price index.
(f) Determine the base period weighted Quantity index
(g) Determine the current time weighted price index.
(h) Determine the current time weighted quantity index.

You might also like