Wat is the Difference between simple index and weighted index numbers
Answers
Answer:
What is the difference between simple index number and weighted index number? In the simple index number all items of the series are treated as of equal importance. In the weighted index, weights are accorded to different items depending on their relative importance.
Explanation:
Answer:
° SIMPLE INDEX NUMBER :- 1) Simple index number is a method of constructing an index number in which every commodity is given equal importance.
2)This method can be use to determine the price index number, quantity index number and value index number.
3) It is the easiest method for constructing index number. ° WEIGHTED INDEX NUMBER :- 1) weighted index number is a method of constructing an index number in which suitable weights are assigned to various commodities. 2) This method can be applied to determine price index number and the special purpose index numbers. 3) It is relatively complex as compared to simple index numbers. hope it helps