CBSE Class 11 Economics VBQs Index Numbers

Very Short Answer Type Questions

Question. State two categories of price index numbers.
Answer : (a) Simple index numbers
(b) Weighted index numbers.

Question. Name the consumer groups for which CPI is computed.
Answer : There the three consumer group for which CPI is computed :
(i) CPI for industrial worker
(ii) CPI for urban non manual employees
(iii) CPI for agricultural labourers.

Question. Give Lapser’s formula for weighted index number.
Answer :

Question. Write the formula for calculating index of industrial production.
Answer :

Question. Define current year.
Answer : Current year is the year for which average change is to be measured or index number is to be calculated.

Question. Give the formula to calculate the rate of inflation.
Answer :

Here, A ₁= WPI for week first (1)
A ₂= WPI for week second (2)

Question. What does wholesale price index indicate?
Answer : WPI indicates the change in the general price level.

Question. Which index number is known as cost of living index?
Answer : Consumer price index (CPI)

Question. In how many groups all the commodities are classified for WPI?
Answer : Three

Question. Which index number is generally used to measure inflation?
Answer : Wholesale price index number

Question. Which item having the highest weight in CPI for industrial worker?
Answer : Food

Question. What do you mean by index numbers?
Answer : An index number is a statistical device for measuring changes in the magnitude of a group of related variables.

Question. Define base year.
Answer : Base year is the year of reference from which we want to measure extent of change in the current year.

Question. What is price relative? 
Answer : A price relative is the percentage ratio of the value of a variable in the current year to its value in the base year.

Question. Where can we get some important index numbers such as CPI, WPI IIP etc.?
Answer : Economic survey

Question. How many types of CPI are constructed in India?
Answer : There are three types of CPI.
(i) CPI (IW) (ii) CPI (UNME) (iii) CPI (AL)

Question. What is the difference between simple index number and weighted index numbers?
Answer : In simple index number, all items of the series are accorded equal weightage or importance but in weighted index number different items of the series are accorded different weightage, depending upon their relative importance.

Question. Which sign is used to indicate the price index number?
Answer : Po1

Question. Give Paasche’s formula for weighted index number.
Answer :

Question. Mention the weight of primary articles in wholesale price index.
Answer : 22.02 % (or) 22%

Question. Mention the weightage of different groups in index of industrial production.
Answer :


 

Question. Which change is measured in consumer price index?
Answer : Retail Price

Question. In which index number there is a relative importance of the items?
Answer : Weighted index numbers.