Question 19 of 35
Q.Distinguish between
s
imple index numbers and weighted index numbers.
Maharashtra MsbshseMaharashtra HSC (MSBSHSE) Board 2023Subjective· 2mImportance★★★★★
54% · 19/35 Questions
You're viewing a preview — the full solution, concept, methods & PYQ mapping are locked.
Start your 14-day free trial to unlock the full solution →Simple (unweighted) index numbers give equal importance to every item, while weighted index numbers assign each item a weight according to its importance. Weighted index numbers are therefore more accurate and realistic.
An index number measures the change in the level of a variable (such as prices) between two periods. Depending on whether items are treated as equally important or not, index numbers are classified as follows.
| Basis | Simple (unweighted) index numbers | Weighted index numbers |
|---|---|---|
| Meaning | Constructed without assigning weights; all items are equally important | Constructed after assigning suitable weights to items as per their importance |
| Weights | No weights are used | Weights (usually quantities or values) are used |
| Accuracy | Less accurate and less realistic | More accurate and realistic |
| Methods | Simple aggregative and simple average of price relatives | Weighted aggregative (Laspeyre, Paasche, Fisher) and weighted average of relatives |
Unlock everything free for 14 days
- Full step-by-step solutions
- Concept-first explanations
- Methods, shortcuts & mistakes
- PYQ mapping + timed mock tests
Full access for 14 days. No credit card required.