Question

If the index no. Of price at a place in 1994 is 250 with 1984 as base year then the price have increased on average by

Answer 1

The index no. for the base year i.e 1984=100

The index no. for 1994=250

So the price is increased by =250/100=2.5

Answer 2

Given:

(i) The index no. of price at a place in 1994 is 250 with 1984 as base year.

To find:

(i) The price have increased on average by.

Solution:

Given that, 1984 is the base year.

We know that the index number in the base year is always 100.

It then increased to 250 in 1994.

So, the prices have increased on average by a magnitude of = (Increased price/BasePrice)

= (250/100)

= 2.5

So, 2.5 is the magnitude by which the price have increased on average.