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CA foundation stats index numbers related problem ​

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Business Mathematics and Statistics > Index Numbers

Index Numbers

Suppose the price of a commodity changes from 100 to 120 and then from 120 to 180. Here just by looking at this information, we can tell that the price has hiked by 20% and 80% respectively with respect to the initial price. It is situations like these or even more complex ones where the index numbers come in handy. An Index number helps in the calculation of percentage change in a phenomenon with respect to a base parameter. Let’s learn some more about this interesting topic.