Assertion (A): Fisher's index is called 'ideal' because it satisfies important mathematical tests. Reason (R): It is the geometric mean of Laspeyres and Paasche indices, balancing their biases.
A. Both A and R are true, and R is the correct explanation of A
B. Both A and R are true, but R is not the correct explanation of A
C. A is true but R is false
D. A is false but R is true
Answer: Option A
Solution (By JKSSB Mock Tests)
Fisher's index earns the 'ideal' designation by satisfying time reversal and factor reversal tests, achieved through its geometric mean formulation that mitigates the upward bias of Laspeyres and downward bias of Paasche.
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