Laspeyres price index uses which quantity weights? MCQ with Answer and Explanation

Laspeyres price index uses which quantity weights?
A. Geometric mean of quantities
B. Current period quantities
C. Base period quantities
D. Average of base and current quantities
Answer: Option C
Solution (By JKSSB Mock Tests)
Laspeyres index = Σ(p₁q₀)/Σ(p₀q₀) × 100, using base period quantities (q₀) as weights, which may overstate inflation if consumers substitute away from goods with rising prices.

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Practice More Statistics Questions

Question #1
Which test of index numbers is violated by Laspeyres index?
A. Unit test
B. Factor reversal test
C. Circular test
D. Time reversal test

Correct Answer: Option D


Explanation:
Laspeyres does not satisfy time reversal test; P₀₁(L) × P₁₀(L) ≠ 1.

This question belongs to: Accountancy and Statistics Statistics
Question #2
The crude birth rate of a population is 30 per 1000 and crude death rate is 8 per 1000. The natural increase rate is:
A. 3.75%
B. 38 per 1000
C. 2.2%
D. 22 per 1000

Correct Answer: Option D


Explanation:
Natural increase = CBR - CDR = 30-8 = 22 per 1000.

This question belongs to: Accountancy and Statistics Statistics
Question #3
A random experiment is defined as:
A. An experiment with a predetermined outcome
B. An experiment where all outcomes are equally likely
C. An experiment that can be repeated under identical conditions with uncertain outcomes
D. An experiment conducted only once

Correct Answer: Option C


Explanation:
A random experiment has well-defined possible outcomes, can be repeated under similar conditions, and the exact outcome cannot be predicted with certainty before performing the experiment.

This question belongs to: Accountancy and Statistics Statistics