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Question 23 of 35
Q.

Calculate Marshall – Edgeworth’s price index number for the following data:

CommodityBase yearCurrent year
PriceQuantityPriceQuantity
P12201824
Q14122116
R8101218
S16152025
Maharashtra MsbshseMaharashtra HSC (MSBSHSE) Board 2023Subjective· 4mImportance★★★★★
66% · 23/35 Questions
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Apply the Marshall–Edgeworth formula P01=∑p1(q0+q1)∑p0(q0+q1)×100P_{01}=\dfrac{\sum p_1(q_0+q_1)}{\sum p_0(q_0+q_1)}\times100; the numerator sums to 25162516 and the denominator to 17841784, giving P01≈141.03P_{01}\approx141.03.

The data (base year p0,q0p_0,q_0; current year p1,q1p_1,q_1):

Commodityp0p_0q0q_0p1p_1q1q_1
P12201824
Q14122116
R8101218
S16152025

Marshall–Edgeworth's price index number is

P01=∑p1(q0+q1)∑p0(q0+q1)×100.P_{01}=\frac{\sum p_1(q_0+q_1)}{\sum p_0(q_0+q_1)}\times100.

Compute q0+q1q_0+q_1 and the weighted prices for each commodity.

Commodityq0+q1q_0+q_1p1(q0+q1)p_1(q_0+q_1)p0(q0+q1)p_0(q_0+q_1)
P444418×44=79218\times44=79212×44=52812\times44=528
Q282821×28=58821\times28=58814×28=39214\times28=392

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